BANK OF ENGLAND

Manawatu Standard, Volume LII, Issue 48, 27 January 1932, Page 7

BANK OF ENGLAND

STRENGTH DEMONSTRATED,

REPAYMENTS OF CREDITS.

BRITAIN’S FINANCIAL PRESTIGE.

(United Press Association—By Electric Telegraph.—Copyright.) Received January 27, 8.30 a.m. LONDON, Jan. 26.

The Morning Post’s financial editor says: “The announcement by the Bank of England yesterday—the repayment on January 31 of credits of £15,000,000 each, the balance, of £50,000,000 advanced by the Eederal Reserve Bank of the United States and the Bank of France in August to assist the sterling exchange—marks the completion of a transaction which, together with the credit obtained by the Government, will always stand as a record of the sin. cerity of Britain’s attempt to maintain the gold standard against overwhelming odds.

“The repayment, without resort to gold shipments, snows the skill with which exchange operations are conducted. The fact that no renawals of loans have been sought indicates a strong position. There remains outstanding £40,000,000 which the Government obtained from France and the United States in August for a year.” “The best news the market has had for months,” says a leader in the Times, referring to- the repayments. “It is a notable sign of the Bank of England’s strength, demonstrating confidence in its resources, especially when . many banks throughout the world are gravely embarrassed. It will increase British financial prestige and prove the pound’s ability to maintain its position. Indian gold arrivals have now reached £30,000,000 and indirectly are helpful.”

GRATIFYING POSITION

GOLD SUPPLIES FROM INDIA. (British Official Wireless.) Received January 27, 11.30 a.m. RUGBY, Jan. 26. An appreciable improvement in the sterling this morning followed the announcement that the Bank of England would complete next week the repayment of outstanding credits to the New York Federal Reserve Bank and the Bank of France. The New York cable rate rose from the overnight figure of 3.44 dollars to 3.46 J. The Times’s city editor describes the statement as extremely gratifying, adding: “The fact that the credits are not being kept open is a demonstration of the strength of the bank’s position, for had the bank felt it was desirable as a matter of precaution to keep its liabilities open in case of need there would have been no difficulty in arranging for their renewal. Large sales of gold by India may have indirectly proved a helpful factor. No one foresaw that the suspension of gold payments would lead hoarders of gold, w r ho in the last thirty years absorbed about £365,000,000, to begin to dispose of it. About £30,000,000 worth of gold has been shipped from India since September 21. and the _melting continues. In this way India is not only making a profit for herself, but also is making a useful contribution to world economy.” The Manchester Guardian says: “The fact that the repayment has been effected without a reduction of the bank’* gold reads as an agreeable surprise.”

PRICE OF GOLD.

STOCK EXCHANGE BRIGHTER.

Received January’ 27, 11.0 a.m. LONDON, Jan. 26. Gold is quoted at £5 19s 3d. The Bank of England’s payments have led to a brighter tone on the Stock Exchange. Gilt-edgeds firmed on the strength of the sterling; Australian and New Zealands mostly advanced £l.