EXCHANGE IMPROVES

Hokitika Guardian, 22 February 1932, Page 6

EXCHANGE IMPROVES

EFFECT OF LOW BANK RATE.

AUSTRALIAN STOCK UNCHANGED

(United Press Association. —By Electric Telegraph.—Copyright.)

(Received this day at 10.15 a.m.) LONDON, February 20

The commercial summary of the reduction in the hank rote has had a j tonic effect on the stock exchange, ' and all sections rapidly responded. Previously, business had been quiet. “The ‘bullishness’ of Wall Street, which followed the Government’s proposals for the expansion of credit are not being reflected here, but on Thursday,- when in addition to the hank j rate reduction, we had another good revenue return, optimism was ap--1 parent everywhere, and British funds ! jumped upwards, War Loans five per ' cent, touching par for the first time since we went off the gold standard in September.

j “Australian Government securities, however, mostly showed little change, : the} announcement of the Commoni wealth Government’s proposal to ask j stockholders to accept a reduction in I interest being unfavourably received. The general impression in financial 1 circles is that there is little probability 'of such a proposal being accepted. { Jobbers on Tuesday attempted to put up the price of New South Wales 'per cent., on the announcement that the interest was being paid, but no business was done, and tlie quotation remains unchanged.”

I Commenting on the Commonwealth Insurance Bill, the “Morning Post’ 'says: “British insurance companies j no doubt consider it a trifle anomalous that the Commonwealth should require higher deposits than does the British Government in respect to companies doing business here, but they welcome j the provision in the new Bill that noState Government may require any insurance company to make deposits ias well, and the fact that the de- ! tention of deposits by any State Government i-s expressly forbiden.”

PRESS’ OPTIMISTIC COMMENT LONDON, February 21.

The Sunday newspapers optimistically comment on the bank rate reduction as an indication that the crisis has passed. Tlie “Observer” advocates a further reduction of one per cent, to encourage industrial enterprise. The “Sunday Times” says the hank rate will have to fall further before a big conversion war loan is possible. If income tax were lowered the prospects of a successful conversion would be greatly improved.