TRADE AT HOME.

Taranaki Daily News, 19 September 1921, Page 5

TRADE AT HOME.

THE FINANCE MARKET.

WOOL OUTLOOK BETTER. BUTTER UNSATISFACTORY. By Telegraph.—Press Assn.—Copyright. Received Sept. 18, 11.5 p.m. London, Sept. 17. The outstanding feature of the Stock Exchange has been the firmness of gilt-edged stock, which even the unsatisfactory Irish development has failed to affect. The chief cause for firmness was apparently due to the removal of the selling pressure which previously existed, and absorption of heavy blocks of Government issues which have been hanging over the market. Instead there is now persistent buying pressure in the investments markets. Another factor is the extremely easy conditions prevailing in the money market, as instance of which three-months Treasury bills were placed yesterday at an average of 80/6 per cent., compared with 119/3 on April 21. In marked contrast is dullness in the more speculative sections, in which prices are mostly tending downward. Wild fluctuations in foreign exchanges arc mainly due to a heavy slump in the German mark, the cause of which is difficult to ascertain. In some quarters it is attributed to the heavy reparations payments, and it is suggested that Germany may be trying to bring about the complete collapse of its currency, hoping thereby to .secure a revision of the financial terms of the treaty. On the other hand, it is stated that leading German bankers have given the Government assurances as to the provision of the funds necessary for the next reparation payment on November 15. A well-known wool authority says the severe financial pressure continues to dominate the situation in the manufacturing and merchanting sections. There has lately been more enquiry for export, but orders are principally filled from stock. The home trade is in the unfortunate position of being unable to find a market in America, owing to the tariff, and is also suffering acutely from the European exchange position. Nevertheless, the conditions are less adverse to improvement in business, and there are encouraging signs of gradual relief from the more depressing features of the slump. Progress is extremely slow, but gradual. An adjustment is being made in the direction of reduced costs of production, and for better wages at home and on the Continent, which together will tend to i lessen the existing disparity between Continental and home costs. A wave of depression is passing over the provision trade. Butter, cheese, bacon, lard and eggs have all slumped, and, despite a considerable fall in prices there is little trade passing in any of these commodities. The position regarding butter is particularly unsatisfactory. The optimistic feeling prevalent among traders two months ago has disappeared, and has been replaced by doubt and nervousness. Many importers consider the present position is largely due to the muddle-headed policy of the Government’s handling of its stocks. After hurriedly rushing the price up in July, the Government is now taking an equal!}’ hurried course. When prices were raised many retailers, anticipating a further rise, have' purchased heavily, and, the public refusing to pay the high prices, the retailers are now saddled with large stocks, on which' the loss is increased by each reduction in Government prices, so that instead of the Government stocks being steadily cleared there are still 30,000 tons on hand. The prospect of moving it seems remote, unless prices are further reduced. Consumers show an increasing disinclination to pay the present high prices, and though the best New Zealand is obtainable at 2s 3d a pound the consumption is small. Housewives are taking margarine, the best brands of which are obtainable at Is 2d. The newspapers are carrying on a campaign against high food prices, alleging that The retailers are profiting excessively, and the campaign undoubtedly is influencing the public.—Aus.-N.Z. Cable Assn.