Overseas Trade In Balance

Press, Volume XCV, Issue 28260, 24 April 1957, Page 3

Overseas Trade In Balance

Sir,—Your leading article says “the prudent course for this country is to use the present opportunity to strengthen the overseas reserves in the present year. The situation does not call for any relaxation of the credit squeeze.” On April 3, “The Press” carried a news item from the “News Chronicle” Bonn correspondent which said: “Germany now has official reserves worth 3300 million dollars. . . . Gold and dollars are flowing into Germany from other European Payments Union countries on such a scale that she is able to settle her debts from the rest of the world and add to her reserves.” British economists say the German mark is undervalued and this makes German goods cheaper abroad and foreign goods dearer in Germany. Last year New Zealand, unable to redeem loans of £40,000,000 at 3 per cent, interest, converted them into a new loan at 4| per cent. Seems Germany manages her finances better.—Yours, etc., L. J. SPENCE. April 22, 1957. [Does Mr Spence really mean that he would like New Zealand to tighten the squeeze to give the same results as the “hard” money policy by which Germany has avoided a repetition of the inflationary folly after the First World War?—Ed. “The Press.”]