EXCHANGE RATE

Hokitika Guardian, 5 April 1933, Page 2

EXCHANGE RATE

INFLATION IS -CONDEMNED.

STATEMENT :BY IMPORTERS’

WELLINGTON, April 3. 5

Mr S. Salmond, president of the New Zealand Importers’ Federation, in a statement; sayt>;\

“Each week brings a fuller realisation of the-famire of the . . Governfv , *• - in ■ ■ meat’s inflationary policy as the ill effects of this enoneous policy, become clearer. The defenders, of. the high exchange find greater difficulty in endeavouring to- allay , the" natural alarm of the people. Many apologists seek to avoid the local evidence and refer,

ad infinitum, to the. Australian 25 per cent, exchange, completely overlooking the fact that the economic and financial conditions in the two countries make a comparison impossible. It is a pity' to see responsible persons trying to make the Australian case fit' the altogether different circumstances of the Dominion. “The Importers’ Federation doeß not profess to decide what exchange policy is. good vor bad for, Australia, hut it emphatically reiterates .that the pre-

sent policy in New, Zealand is detri-

’ mental to this country.. After a little egtmore than two months’ operation of the high exchange the Government has much food for thought regarding its

obligations under the Banks IndemBill, which provides for the pur* J ‘vqhaah hy'the Bank of New Zealand, os tl* Government agent, of surplus hon- . don funds held by other bftnks wish* jng to get fid of them. It is no secret that the Bank of Nfiyv; Zealand has already been presented-.wi|h substantial purchase demands, >ancl..citizens of tho Dominion have, to pay £125 for each £IOO of London money they buy. Figures published on Friday show a mrii-ked monthly decrease in imports, with a consequent slackening in the demand for London credits. “It would be interesting to learn just wh'at amount of overseas funds the Government, through the bank, is being called on to acquire. Tlio public has an unquestioned right to~kno\v, and failure on the part' of the Minister for Finance would naturally lead to widespread speculation. The suspicion might easily arise that tho authorities are already alarmed, at the effect- on the national finianeo§ of the- exchange policy. N°; clear-thinking person facing the facts can fail to see that the longer the .exchange remains up the worse will be the effect on the Dominion us a whole. 1 . Repeated: official denials of any intention to. review the position merely indicate absurd • stubbornness rather than a genuine desire fou; what is best’ for ; New Zealand.”