NOT UNPRECEDENTED

Wairarapa Times-Age, 30 May 1939, Page 6

NOT UNPRECEDENTED

SHORTAGE OF STERLING RESOURCES RESERVE BANK AND TRADING BANKS. RATIONING WHERE FUNDS ARE INADEQUATE. (By Telegraph—Press Association.) WELLINGTON, This Day. An inquiry was made at the Reserve Bank toda?z in order to obtain information as to the position arising out of the permits issued by that institution for the remittance of funds overseas. It was realised by the Reserve Bank that a certain amount of misunderstanding, exists, ..as to the nature of such permits, but these permits, it was explained, merely constitute an authority to the various trading banks to use for the purpose specified any funds which may be available out of those received by them on behalf of the Reserve Bank from the proceeds of exports or otherwise. If at any time, however, the trading banks have not in hand a sufficient amount of such overseas funds to meet all the demands being made on them in respect of import licences and exchange permits, it is incumbent on them to ration those funds, and in so doing it is natural that consideration should be given to the relative urgency of the various demands, including the needs of the trade situation. It will be remembered that the rationing of overseas funds has been necessitated on previous occasions during a temporary shortage of sterling resources.