HIGH MONEY RATES

Sun (Auckland), Volume III, Issue 757, 2 September 1929, Page 11

HIGH MONEY RATES

treasury bills AT 54 ' PER CENT. AWKWARD FOR AUSTRALIA iiustralian c, id N.Z. Press Association) LONDON, Saturday. Australia is not alone in having to a high rate of interest on Treasury bills, for yesterday’s issue of British three months’ Treasury bills was flared at a shade under 5£ per cent., which is the highest rate paid for these securities for a long time. The result of the tenders for '£5.000,000 of Commonwealth 12 months' Treasury bills— the prices accepted representing an average rate ct £6 3s per cent.—certainly has not improved Australia’s financial standing in London. Although the high rate closely accorded to market anticipations, the position apparently shows i eß g confidence in Commonwealth finances than is really indicated on closer study, since a combination of many circumstances, largely technical in nature, makes the present moment especially inopportune for any considerable borrowing, irrespective of the borrower’s identity. ■ V CAUTION NEEDED RAILWAYS CONSTRUCTION HINT FOR NEW ZEALAND (tnitcd P.A. 1 1 [j Telegraph — Oogyvtght) LONDON, Saturday. The “Financial News” discusses New Zealand s railway policy arising nut of criticisms in New Zealand regarding the South Island main trunk line. The paper says the British investor uresumabiy will be asked to lend tne money. If be forms the impression that the loans are to be employed on works that will long remain unproductive and constitute a drain on the general revenue, then the rate of interest inevitably will harden. These considerations suggeFt that in the present state of the railway ilnances of New Zealand and elsewhere, caution should be exercised •where it is a case of embarking on heavy capital commitments.