A (1) 25
The second feature to be noted is the unusually high premium of the Hong Kong Dollar over the Chinese Dollar as reflected in the quotation on Shanghai. The rate that, normally should be about 110 rose in October and at times has been over 130. The trend of the premium during the first quarter of this year has been generally still higher and at the time of writing (April 30th) is 140. Our local dollar, though experiencing the occasional divergences from silver parity incidental speculative market has generally been kept well under control.
28. The Chinese Dollar now "managed" has remained below parity so consistently that heavy shipments of silver from China have been inevitable and have seriously embarrassed the money market in Northern Ports. The continuance of this high premium is a cause of concern to local interests.
29. Trade returns show a further decline. Imports, excluding treasure, amounted to $415,918,522 during the year, the total for the previous year being $500,938,794. Exports were $325,104,653 against $403,092,170 for 1933. Trade conditions are so fully examined in the recently published Report of the Economic Commission that it is not necessary to comment here on the causes of the decline and the suggested remedies.
30. The share market has been almost lifeless and prices of nearly all investments have sagged in the absence of support. Property values also have fallen though building still continues. Bank deposits remain high but notwithstanding easy interest rates there is little demand for money. Note Issues have fallen to $153-3/5 millions from $157 millions at the end of 1933, a natural decline having regard to the decreased velocity of circulation consequent on the general inactivity of trade. Several of the more important Chinese Banks have opened branches in Hong Kong during the year and there have been no notable difficulties among the smaller native banks. The credit and repute of the Colony's financial institutions have never been higher than during this difficult period and it is satisfactory to be assured that ample encouragement and support are available to finance any possible demand that a revival of trade would need.
THE TREASURY,
HONG KONG, 30th April, 1935.
EDWIN TAYLOR,
Colonial Treasurer.
A (1) 25
The second feature to be noted is the unusually high premium of the Hong Kong Dollar over the Chinese Dollar as reflected in the quotation on Shanghai. The rate that, normally should be about 110 rose in October and at times has been over 130. The trend of the premium during the first quarter of this year has been generally still higher and at the time of writing (April 30th) is 140. Our local dollar, though experiencing the occasional divergences from silver parity incidental speculative market has generally been kept well under control.
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28. The Chinese Dollar now "managed" has remained below parity so consistently that heavy shipments of silver from China have been inevitable and have seriously embarrassed the money market in Northern Ports. The continuance of this high premium is a cause of concern to local interests.
29. Trade returns show a further decline. Imports, exclud- ing treasure, amounted to $415,918,522 during the year, the total for the previous year being $500,938,794. Exports were $325,104,653 against $403,092,170 for 1933. Trade conditions are so fully examined in the recently published Report of the Economic Commission that it is not necessary to comment here on the causes of the decline and the suggested remedies.
30. The share market has been almost lifeless and prices of nearly all investments have sagged in the absence of support. Property values also have fallen though building still continues. Bank deposits remain high but notwithstanding easy interest rates there is little demand for money. Note Issues have fallen to $153-3/5 millions from $157 millions at the end of 1933, a natural decline having regard to the decreased velocity of circulation consequent on the general inactivity of trade Several of the more important Chinese Banks have opened branches in Hong Kong during the year and there have been no notable difficulties among the smaller native banks. The credit and repute of the Colony's financial institutions have never been higher than during this difficult period and it is satisfactory to be assured
assured that ample encouragement and support are available to finance any possible demand that a revival of trade would need.
THE TREASURY,
HONG KONG, 30th April, 1935.
EDWIN TAYLOR,
Colonial Treasurer.
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