ENGLISH COMMERCIAL. (FROM THE HOME NEWS.)

West Coast Times, Issue 653, 28 October 1867, Page 2

ENGLISH COMMERCIAL. (FROM THE HOME NEWS.)

MoifEr Market and City Intelligence, London, Aug. 26, 1867.

Tho reduction in th<» rntc of discount made on July 25 to 2 per ceufc. has not, as we anticipated in our last, had any offect in stimulating the commercial demand for money. On the contrary, the demand haa fallen oif, and there is a general increase of unemployed deposits at all the banks, including tho Bank of England. At some banks conditions have been imposed upon the acceptance of deposits which practically prohibit them from being made. For instance, they will only be received from established connections, aud then of fixed amounts for given periods. New money is reluctantly taken. As the utmost that can now bo obtained is 1 per cent, at call, and I 5 per cent, at seven and fourteen days' notice, it would seem to be hardly worth the while of the public so to place their money, seeing that Consols at present prices pay nearly 3£ per cent. But the bankers canuot lend the money they have. On August 22 it was found impracticable to employ it even at J per cent, upon Government stock ; so that very large amounts areidlo. The best commercial bills are taken at 1 J- to If per cent., but there are so few in the markot that transactions are known to have taken place at l£ per cent. — tUe parties advancing paying substantially as much for the use of the money as they receive for it, without making allowance for office expenses. Many country bankers in tho agricultural districts pay to then* depositors fixed rates, s.iy 4 per cent., without reference to the price or to the fluctuations of the market, and when they canuot use the money in their own district afc 5 per cent., or higher, they send it to tlio London^bill brokers. As they will now receive ffo r such deposits only 1 per cent., it is difficult to see how profit is to be realised under such circumstances, though a fair average gain may perhaps be realised upon the whole year. There is no immediate prospect of a termination to this anomalous state of things, and the present impression is that a largo amount of banking reserves must, in stress of othor employment, be placed in the Funds.

The Bank of England, according to the return of August 21, held L23,532,G61 of bullion, being 1.760,797 more than at the date of our last (July 2G), with a reservo of notes and coin of L 14,600,771, being an increase within the same period of L 831,622. Tnis represents an increase in banking resources of L 1,592,419. The securities representing discounts and advances have fallen off about Ll ,000,000. The Bauk of France hold (August 22) upwards of L 36,500,000 gold. Consols wheu we last wrote stood at 94i to i.^ In the iuterval they have agaiu touched 95, but whenever they have arrived at that price a reaction has always followed. At times this reaction has been caused by feara, now happily dispersed, about the harvest aud by apprehensions of war on tho Continent, which are now also happily dispersed. At the present moment the Stock Exchango is deserted by tho principal dealers and operators for the sea-side and the moors, so that the market is littlo better than nominal ; and the purchases of Government broker on account of the Sinking Fund havo produced littlo effect, though ho has to invest L 551,000 odd before the end of tho quarter, and as yet he has bonght only L 158,000. Tho present price of Consols is 94£ to f. But New and Rsduccd 3 pur Cents., upon which tho dividend is duo in October, have advanced during tho month from 93f to to 94£ to h Exchequer Bills are very scarce, and they are quoted at 2G3 to 30s pm. It is expected that the interest upon these securities will be lowered to 2 per cent. Bank Stock at last dates stood at 256 to 258. It is now 261 to 263 and scarce, though the next half-yearly dividend will bo a reduced dividend. The 4 per cent. India Stock has been in active demand ; it is now quoted at 113£to£. On July 26 it was 11 L to h It is satisfactory to state that Australian government securities havo shared in the general improvement, and that some large investments have been made iv them at advanced prices. Tho following are tho quotations of August 23 :— New Soutli Wales Government 5 per cent., 1871 to 1876, January and July, 96 to 98 ; ditto 5 per cent., 1888 to 1895, January and July, 91 to 92 ; ditto 5 per cent., reduced by annual drawings from 1867 to 1875, 97i to 9Si : Now Zealand 5 per cent., 93£ to 91^'; ditto, 6 per conL, 1891, March and Soptember, 108 to 109 j ditto, 6 per cent., 1891, Juno and December, 107 to 108 ; ditto, 6 per cent., 1891, January and July, 105 to 107 ; Queensland 6 per cent., 1881-85, January and July, 99 to 100 ; ditto, 1891, January and July, "99 to 100; South Australian Government 6 per cent., 1878 aud .upwards, 105 to 107 ; Victoria Government 6 per cent., January aud July, 1891, I©9£ to llOfc ; ditto, April and October, 1114 to 112£. In Aii3taalian Banking, Money, and Miscellaneous Stocks there is considerable firmness but no particular change, and for prices reforence should be made to tho Share List.