EXCHANGE POLICY

Hokitika Guardian, 23 June 1932, Page 3

EXCHANGE POLICY

OTTAWA DISCUSSIONS,

COMMONWEALTH CURRENCY

REPRESENTATIVES

The decision of the- Commonwealth Bank to send two representatives to Ottawa to keep Australian delegates in touch with Australian currency and exchange conditions, and through them the Imperial Economic Conference, when problems of currency and exchr*nge arise for discussion, was warmly approved in financial and commercial circles, states the -‘‘Sydney Morning Herald.” The..choice -of the bank could not have fallen more appropriately than in the selection of Mr E. C- Riddle, the governor, and of Professor L. G. Melville, adviser to the hank of economics.

It has become more evident that problems of /'Currency -and Sex-change will bo among the major subjects to be discussed. It is possible to lift the general price liv'd to the level of 1929, and to keep it stable at that level? Economists believe in the posi sibiiity. Some bankers doubt. If all the world will not join in the attempt is it possible for the Empire to make , the attempt for itself with reasonable ! prospects of success; or, better still, can the countries linked with sterling lie induced to join in tire attempt? When sterling went off gold in Se|> iember last it was found that there was a number of countries which were more closely linked with sterling than they were with gold, and that it was more to their advantage to remain true to sterling than to follow gold. The joining of these countries with the Empire in a successful attempt to lift prices, and so revive industry and trade might accomplish, just as much as mutual tariff concessions within the Empire. Then there is the subject of fixing a relatively stable rate of exchange, fluctuating perhaps no more than within the narrow limits which gold formerly permitted. That is necessary to ensure that the enhancement of prices should be in the same proportion or nbarabouts in all countries engaging in the attempt. The favourable effect which a stable rate of exchange would have on the interchange of products has also to he considered. The subjects are well worthy of the closest examination.