Sharp Sterling Fall In London

Press, Volume CVI, Issue 31080, 8 June 1966, Page 21

Sharp Sterling Fall In London

(N.Z.P.A. Reuter —Copyright) LONDON, June 6. Sterling dipped to its lowest level in 18 months on foreign exchange dealings in London. The fall—to 2.78 15/16th in dollar parity —came when the Bank of England ceased to give the pound support at just over 2.79.

The fall from Friday’s closing price was the biggest since the sterling crisis of November, 1964, shortly after Mr Wilson’s Labour Government first won power. Selling was reported mainly to come from Continental Europe. Dealers said the pound's weakness stemmed from the three weeks’ merchant seamen strike and speculation of a possible rise in bank rate—the key lending rate—which currently stands at 6 per cent. The Bank of England had supported sterling at a little more than 2.79 dollars for much of last week. Reserves Down

Last Thursday, the Government announced that the reserves of gold and other convertible currencies had fallen by £3Bm during May to £1219m. This was twice the previous month’s losses. The pound reacted somewhat just before the close and ended trading at 2.78 31/32 dollars. Exchange rates advised by the Bank of New South Wales show a weakening of the pound against all currencies except the Danish crown and the Japanese yen. The pound has hardened a little on the Danish crown during the last month. In the bank’s latest exchange rates no quotation is given for the Indian rupee. Latest Rates Latest telegraphic transfer rates:—

N.Z. on Buying Selling New York— Doi. to £ N.Z. 2.7850 2.7535 Austria — Schillings 72.33 70.86 Canada— Dollars 3.0003 2.9620 Belgium— Francs ■ 139.40 136.40 Denmark— Crown . 19.39 18.98 France— Francs 13.73 13.45 Italy— Lire 1748 1711 Japan— Yen 1015 993 Netherlands— Guilders 10.15 9.92 Norway— Crowns 20.05 19.62 Spain— Pesetas — 164.40

Sweden— Crowns . 14.46 14.13 Switzerland— Francs . 12.09 11.83 W. Germany— D.M. . 11.24 10.99 Fiji— fFijl . 111.11.9 110.4.3 Pakistan— Rupee . 13.406 13.080 South AfricaRand . 2.0150 1.9629 Hong Kong— Dollar . 16.195 15.756 Malaysia. Singapore Dollar .. 8.623 8.404 Ceylon— Rupee . 13.406 13.089