INCREASED INTEREST RATES.

Manawatu Herald, Volume LI, Issue 4040, 11 January 1930, Page 2

INCREASED INTEREST RATES.

statement by prime afinister.

Wellington, January 10. The Rt. Hon. the prime Minister (Sir Joseph Ward) stated to-day in connection with the issue of 51 per cent, securities that the views of the manager of one of the financial institutions in Duneclin as reported in the morning newspapers are of interest, but do not represent the general views held throughout the Dominion. As a contrast, Sir Joseph stated that attention may the directed to the views expressed in another direction. That there would be no itnmediate’effeet on mortgage rates, and added that the increase from r, 1-8 par cent, was very carefully considered after taking cognisance of past experience of investments irom all parts of the Dominion in Government securities before a decision was arrived at. Insofar ns the general money market is concerned, Sir Joseph pointed out that lie had already drawn attention to unforeseen contingencies that arose' throughout the world during ~lhe past few months which have had -a definite hearing on our borrowing both

abroad and in the Dominion. The effect of these financial repercussions, he saiid, has not been felt severely in New Zealand; and genera 11 v spenlking, the borrowing rates in this country are not as high as in neighbouring countries. “The Dunedin critic,” said Sir Joseph, “professes to be well ill* formed and asserts that had I fixed a lower rate, the money required would he got till the same. Arv answer is that since February last we have been selling ‘ever the counter’ securities at a rate of 5 1-8 per cut. and if was the falling off of investments throughout the country nf this rate that influenced tsm in • ! f-'idiiK- I~ mam- the i.. i.i.e 5/ per . ir Joseph further added that he preferred r.> rely upon actual facts varher than life assumption of one who does not disclose bis identity and therefore cannot be judged as to his qualifications or experience. And lie drew attention to the circumstance already referred to that during the last six months the.financial world in the United States, in England and in Australia had not been normal, due to causes that are very well-known. Therefore, the Dunedin critic, who lias no responsibility from a public standpoint, offers gratuitous advice which has to be accepted cum grnno salis. Sir Joseph concluded by stating that he had no intention of increasing the present lending rates to workers or settlers.