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by which the trade of South China is chiefly conducted. The scarcity of silver and the enormous requirements of the Indian Government for the metal made it a matter of necessity to protect the reserves of the Colony.
5.
The policy of the Banks in keeping the exchange rate below that prevailing in China has had the consequence that, when the rate of exchange has been below the melting point of subsidiary coin, there has been a tendency for this coin to leave the Colony. The demand for Hongkong subsidiary coin is influenced also by other factors; and, with prohibition of export in force, the situation is for
the time being normal.
I have the honour to be,
My Lord,
Your Lordship's most obedient,
humble servant,
7. L. Stubbs
Governor, &c.
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