BETTER TIMES AHEAD

Evening Post, Volume CXII, Issue 83, 5 October 1931, Page 8

BETTER TIMES AHEAD

OUTLOOK FOR AUSTRALIA

EFFECT OF CURRENCY

MOVE

(Keeeivfid sth October, 2 p.m.) LONDON, 4th October. Pleasant reading for Australia, is contained in an! informative financial review by Mr. G. "W. Alexander, city editor of the "Sunday Express," who attributes the resumed buying of Kaffir shares oh Saturday to the belief that the competition of wool between Australia and South Africa is likely to force South Africa from the gold standard. This will result in African gold producers getting the full advantage of the premium on gold. : He declares Australia's position to be most favourable. While her pound is at 25' per cent, discount,; the South African pound is at present at a premium of 17i per cent.' This gives the Australian pastoralist a considerable advantage over his South African competitor. Both are large producers of merino wool and values approximate closely. Assuming that the basis is a shilling per pound in London, the Australian grower will receive in hia own currency Is 3Jd, whereas the corresponding figure in South Africa will be 10.2 d. It may be argued that the costs in Australia are higher than in South Africa, but they could not bridge- this difference. In point of fact, the low prices realised for the last season have already forced a large cut in expenditure on Australian stations. This will also help the results of the current year. Altogether the outlook has become much more hopeful for .the Australian grower. The development will eventually benefit those concerns engaged in handling and financing the product. The more assured outlook in the wool position appears to suggest better times ahead.!