Steady Currency

Hawke's Bay Herald-Tribune, Issue 139, 29 June 1937, Page 5

Steady Currency

(Britiah Officlal Wirelaga.)

BRfTAIN'S GOLD HOLDING £700,000,000 in Bank Aud Exchange Fund CHANCELLOR^ REVIEW

" (Eeceived 29, 1 p.m.) EUQBY, June 28. Moving ihe rfesolution relating to the Hropos»l to increasq the amount that jpay hq issued to the Exchange Equali■Bitioii Fund from " £350,000,000 to £500,000,000, the. Chancellor pf the Exs qhqquer, gdr Jphn Siwpn, ea.id that there pogld bs nq dciuht that, the existeis.ce and the operation of this Hope unt hadbeen instrumental in promqt; ing and DiaintarHing steady re'covery. daatemporwy operation ef the aocount »iust be- ceaducted with the most corqpiete secrecy because any disclosure wonld ha * heavenr^ent pppqrtunity fpr currenqy speculatora and would thna anjplify thq very uudulatians which thp fugd was engaged in rqduqing, Additional need for the, fgnd hqd been lately created by deliberate shift-. ing of large quantities 'Of gold capital from oue eentrp to another. The exchange aoeount, in the present circumt stances, must bq prepare to add to i|x hcdding of gpld, for thqt was what WPg nqcpssary tq avoid frequent and widft -fluctuqtipns in exchange ratea whpn pew gold Wgs cojning in pnd qlso later on when foreign owners cplled fpr the retuyft pf certain quantitiea of Sir John said that on March 30 gold held in the account was 26,674,000 fine ounces. On the same date there was qljso gold held |n thq isspe dpfcartment • «f the Bfthk pf Epgland amouptiog to 7^,842,000 fipe Qunces, iq^king a total of 100,516,000 fiiie Qunces which, at, the * price pf £7 aa ounce, repreaenfced a little more than £700,000j000. The exchange equalisation account at that date did not hold mere than a trifling amount of fpreign currency, That was the sort of statement that ffeohdd be mqde e,ypy stx months. hlr Petfiwjck Lawrence sftid that the Labour farty soppqrted the qpw P?qm fw qs it'wftg desi^ned to ass«t France. The Labour Party aqpepted tlte princ;plp pf the ^change EquaU■ation Account because it paitly re§tprpd gpntrol of .ouiTency and finance tp the Grpvernment, whereas the Bank «f England had long controlled thp life* blood of the cpinniunity, but the Labour Party thought a £200,000,000 iacrease unnegessarily high. •. • A Labour ainendment tp restrict the iqcrgftse toi £1§0,QQQ,OQQ was defeated by 197 voteg to 96. The resolution was afireed to without division.