COST OF HIGH EXCHANGE

Hawera Star, Volume LIII, 17 June 1933, Page 5

COST OF HIGH EXCHANGE

SUM OF £470,000 FOR SURPLUS EXPLANATION BY MINISTER. AN APPARENT CONTRADICTION. tßy Telegraph—Press Association.) WELLINGTON, June 16. “From various references in newspapers there still appears to be some misapprehension as to the Government’s exchange transaction,” stated the Minister of Finance (the Rt. Hon. J. G. Coates) to-day. ‘ ‘ To. make the position clear I wish to state that the London exchange requirements of -the Government for interest and other ordinary purposes for the last financial year -were fully covered before the question of raising the exchange rate arose. Thus the only additional expense for 1932-33 arising out of the increase iu the rate was £470,000 for the purchase of surplus exchange under ttic Banks- Indemnity (Exchange) Act. “The amount of £1,910,000 so purchased was surplus to the requirements for last financial year and the apparent contradiction contained in the recent statement of mine to the effect that ■the funds taken over from the banks had .not so far exceeded the amount needed to. meet the Government’s ordinary interest requirements in London is explained -by the fact that this latter statement had reference to the current financial year. “Exchange that ha® been purchased under the Banks Indemnity (Exchange) Act will' of course be used where necessary for meeting interest and other normal requirements in London.., for obviously there is no need to make further remittances to London while funds are held in that centre.

“Needless to say, as the funds purchased under the exchange indemnity arrangement are so used, the necessary adjustments will be made in- the public accounts.”