CO129-581-16 British propaganda in Hong Kong 18-4-1939 - 29-10-1939 — Page 49

F.409

BRITISH FINANCE AND COMMERCE

by

ROBERT MACKAY.

49

Currency and Banking.

The holiday demand for currency has

created another high record in the note issue of the Bank of

England. According to the most recent figures the total issue

is £520 millions, and this is £23 millions above the total in

the corresponding week last year. When taken in conjunction

with the remarkable increase in employment this year, these

figures confirm the opinion that the nation generally has more

to spend today than it had a year ago. Moreoever, not only are

there many hundreds of thousands more workers in full employment,

but the existence of a vastly greater number of men in the

country's defence-forces calls for larger supplies of small cash.

Thousands more workers, too, are now in a position to take a

summer holiday, while the widespread adoption of the holiday-with-

pay principle has added to the spending capacity of the British

public.

Bankers' balances deposited with the Bank of England are

lower than at this time last year. The principal reason for this

is that the banks themselves maintain, in all large centres, a

much larger stock of ready-money than formerly, in anticipation of

demands by the public, so that the net decline in bankers' reserves

with the Bank of England is a logical consequence of that policy.

British banking business itself is as active as ever. This, after

an exceptionally large rise of over six per cent. in provincial

bank clearings in June, there was a further rise in July, the

percentage being 0.8 over the June figure. Total provincial

clearings for the first seven months of the year amounted to over

£747 millions, and the rising trend provides encouraging evidence

of the continued improvement in business conditions in Great Britain.