B.— IA

Liabilities in New Zealand

The most marked change during the year was shown in deposits at the Reserve Bank, the figure for which rose from £19,682,000 at March, 1943, to £39,053,000 at February, 1944. During March, 1944, when income-tax was payable, deposits declined to £29,890,000 as at the last Monday in the month. This represented an increase of 51-9 per cent, for the year. Rankers' cash, comprising the trading banks' deposits at the Reserve Bank and their holdings of notes and coin, increased by £11,237,000 during the year, a net increase of 46-0 per cent. There was a sharp decline in the figures for net overseas assets from £14,852,000 at 29th March, 1943, to £8,651,000 at 30th August, 1943, the lowest figure recorded since January, 1940. From August, 1943, however, net overseas assets rose steadily, reaching the total of £11,584,000 at 27th March, 1944, leaving a net decrease of £3,267,000 for the year. Government securities remained steady throughout the year, showing only a small decrease of £24,000 from the figure of £36,166,000 as at 29th March, 1943. The decline in advances and discounts recorded in the two previous financial years did not continue, a net increase of £1,966,000 being shown for the year. The ratio of advances and discounts to total demand and time liabilities fell from 42-5 per cent, at March, 1943, to 40-8 per cent, at March, 1944. On the liabilities side both demand and time liabilities showed an upward trend, demand liabilities having the widest fluctuations, the lowest figure being £72,710,000 as at 26th July, 1943, and the highest being £89,369,000 as at 28th February, 1944. The fall in June and July was attributable to subscriptions by the public to the War Loan being paid over to the Reserve Bank. The net increase of 10-3 per cent. (£7,952,000) for demand liabilities for the year ended March, 1944 continues the upward trend of the previous year, when a net increase of 254 per cent. (£15,614,000) was recorded. Total demand and time liabilities, which stood at £114,814,000 at 27th March, 1944, showed a net increase of £9,115,(XX) over the corresponding March, 1943, figure of £105,698,000. MONEY SUPPLY IN NEW ZEALAND The following tables set out in detail the changes that have occurred in the amount of money in actual circulation in New Zealand in the form of coin, notes, and demand deposits of the Reserve Ba.uk and the trading banks since 1939 Volume of Money in Circulation in New Zealand in the Form of Coin, Notes, and Bank Demand Deposits* (Last Monday in December) rr 7 /• 7i ir

Volume of Money

5

(£(N.Z.)000) r i.»« j • ht i.u Demand Time Total Demand and Last Monday m Month. Liabilities. LiabiUties. Time Liabilities. 1943 March .. .. .. 77,139 28,559 105,698 April .. .. .. 81,329 28,696 110,025 May .. .. .. 83,165 29,060 112,225 June .. .. .. 78,993 29,041 108,033 July .. .. .. 72,710 28,772 101,482 August .. .. .. 75,502 29,196 104,698 September .. .. .. 78,528 29,693 108,221 October .. .. .. 78,184 29,719 107,903 November .. .. .. 79,212 29,561 108,774 December .. .. .. 84,130 29,981 114,111 1944 January .. .. .. 88,515 29,568 118,083 February .. .. .. 89,369 29,760 119,129 March .. .. .. 85,091 29,723 114,814

(£(N.Z.) millions) 1939. 1940. 1941. 1942. 1943. Coin (estimated) .. .. 1-7 1-8 1-9 2-4 2-6 Notes held by public .. .. 15-6 17-4 20-2 27-1 33-4 Demand deposits at — (a) Reserve Bankt •• .. 2-9 8-4 9-2 11-4 17-0 (b) Trading banks} .. .. 41-3 49-7 54-0 70-9 84-1 Total .. .. .. 61-5 7T-2 85-3 111-8 137-1 Change during year .. .. +15-7 +8-1 +26-5 +25-3 For notes see page 0.