HARASSED MERCHANTS

Evening Post, Volume CXIV, Issue 125, 23 November 1932, Page 10

HARASSED MERCHANTS

EXCHANGE UPSETS TRADE

Business generally, importing and other, is all upset by the prevailing uncertainty of the question of the exchange rate New Zealand on London. Travellers returning from their territories in both Islands report that it is next to impossible to do business, as wholesale and retail traders say they do not know where they are likely, to be when the goods come to hand. They may be bought at a very heavy loss if the exchange goes up, at prices, in fact, that their customers cannot afford to pay,: and the goods be left on the importer's hands should the rate be increased. Where orders are being booked at all they are . for relatively trifling amounts, dozens instead of grosses, hundredweights instead of tons. Stocks are reported low in many lines, and yet there is no disposition to replenish them all the time the uncertainty as, to the future rate of exchange exists. In fact, it appears to be no exaggeration to say, from the evidence furnished by travellers to their principals, that business so far as importing is concerned, is at a standstill. ,

In some cases prices have already been advanced in anticipation of a rise in the rate. A local indent house has submitted" proof of this. It advised its clients onlyyesterday of prices for certain goods imported from the Straits Settlements. Those prices had to be withdrawn to-day and higher quotations substituted. Lines quoted at sV£d for example were raised to 6'4d, and so on in proportion; goods costing 39s lid yesterday were raised to 45s 6%d to-day. The lines affected need not be specified any further than to state that they are popular lines much affected by persons with limited income. The rise in prjce—in anticipation of higher exchange—represents 17% per cent, in country of export, and would amount to 25 per cent, or 30 per cent, by the time the goods reached the retail counter; in fact, ''The Post" was assured that goods are quoted at prices in the East to-day for indent at prices in excess of those for which they are selling iv New Zealand itself. ' •■

Singapore to-day turned down some £1200 worth of business in one popular line required by a Wellington firm.

The reason given for the rise in the rates of produce to be shipped from Singapore by the next direct steamer to New Zealand, leaving Calcivtta early next month is "owing to high exchange," and instructions received by Eastern houses from their principals in London to make the advances in prices for New Zealand business in expectation of the rate of exchange being advanced in the immediate future. As far back as 9th September an Eastern house wrote to its agents in Wellington, stating that the banks* in the East were then asking "much higher rates for demand drafts on New-Zealand, as it was the opinion of the London principals of such banks that sooner, or later the New Zealand rate would be raised to that'of Australia." '-..-•