The Express.
London, England, 1865-10-09 00:00:00

THE FRESH RISE IN THE BANK RATE OF
DISCOUNT.

Mace the Daily Nora)
Three changes is the Bank rate in one and the
same week are quite unprecedented in the annals of
that establishment, and on ao former occasion, we
believe, have the Bank altered their rate on a Satur-
day. The exceptional features of the measure
Lave naturally attracted • great deal of atten-
tion, but as most persona bad come to the conclusion
that the Bank rate, in the event of a continues.)e
of the recent pressure, would have been advanced
to 7 per eent. early in the mining week, the accele-
ration of the change by a few hours has not caused
any (*illusion. As usual, various motives are con-
jecturally assigned for this sudden *otitis. One cause
is probably Saturday's large withdrawal of sove-
reigns for export to Brasil, to the preparations for
which we drew attention in our paper of Friday.
There wee again a good demand on Saturday at
the Bank discount office, but not sash a pressure as
usually furnishes • motive for a rise in the rate of
discount. The lase is, however, that the at
bssa.Jiisited mum at the command of the
IBank has latterly lissome so greatly reduced, that
the directors did not think themselves justified in
allowing it to be further trenched upon without re-
sorting to strong mammal of defence. Saturday's
action must be regarded as • decisive proof of the
determination of the Bank executive to attract
back to their till, by all the means is their power,
a portion of the sums lately drawn from it, and
there is 801310 prospect that such • tarn will be 1
given to the foreign exchanges as will afford Bernell
relief in this The effect of the rise here, I
however, will be partly neutralised if, as is proba-
ble, the great Continental banks follow suit ; and it
would certainly seem that the Bank of Franca must
without delay raise its rate of discount from 4 to 5
per cent. Meanwhile there remains to us the re-
grotto' reflection that these ceaseless changes in the
Bank rate of discount, mid—what is still more
powerful for harm—the distrust and fear of even
greater stringency which they naturally beget, can
scarcely fail to act injuriously upon the trade and
enterprise of the country, the indications of reco-
very in which have latterly been watched with such
universal satisfaction. The prevailing uncertainty
as to the point to which the rise in the value of
money will be carried under the stringent opera-
tion of our currency laws will inevitably cause
sober non-speculative merchants to withhold
their orders, and even to countermand those
which they have already given out. Fortunately,
the trade of the country is in so sound a state that
we can afford to watch without the slightest alarm
the efforts of the Bank of England to retrieve its
position, the
mtLtheaLaitmworeint
yearbeespeil:hcivallerreßdy:kftohranneretemisosee:rierdisyous
wcounnt.pro-
bability that this retrieval will be accomplished in
the course of a few weeks. Meanwhile, however,
underwent no leas than 15 alterations ; this year
we have already had 14 distinct changes. An
active foreign drain of bullion, which is usually the
cause of a rise in the Bank rat*, is now absent, and
the notes and coin, the absorption of which has
provoked so much wonder and even consternation
amongst the advocates of the Bank Act of 1844,
are wanted mainly for the purposes of the legitimate
trade of the country, yet, so absolute is the limita-
tion of the currency, and so rigidly is its volume
restricted to that of 25 years ago, that a mere
revival of trade is now found sufficient to reduce
the Bank to great straits, and to force its executive
to attack the commerce of the country with a series
of severities hitherto unprecedented. It seems to
us that faith in the adequacy of the currency sys-
tem of 1844 for the requirements of the trade of
1885 is likely to receive a great blow from the
experiences of this autumn--experiences which, it
is satisfactory to know from the indications of the
past session of parliament, are not likely to be lost
upon our open-minded and enterprising Chancellor
of the Exchequer.
- -

(From the Treks.)
The rise during last week was 24 per cent., a
a movomset unprecedented in so short a spats. It has
bests reedited eassatial, however, by the volustary action
of the trading public, who have skein, not oily iodifference
to each SIIOOtTiTO advance, bm coit
us' on
morning
an sageness to income their transacting on the me tonne
Oa Saturday, for the first time, there were partial
symptoms that they are no longer nosnintously of opiates
that the Bank are offering money oo coaditions that con.
Wink' • great Wads to those who can obtain it,
since on the *Mikados that mesa per cent.
would be charged some parties decided to withdraw
their application's. The probability of a reactios
is, therefore, at length apparent. if any disposition
be felt to question the Bank management in delaying the
rise until the necessity became so urvut, it is mom le toms
that the present Positron of the money market being wholly
without parallel to the history of finance uoither the Bank
&nem nor any other pence' are be reproached for want
of full previska. At no foram period, assent durieg
panics or runs front political cc OQMODKIDOi dimaters, hem it
ever bees found requisite to dunce the rata of disoount
in the fees of • prolonged favourable condition of the foretell
exchanges. For four months there has almost 'minter
.
ruptedly been favourable kiwis, week by week, in the
operationof the bullion market, so regards exports and
imports, and daring that tem ths home commensityabout have
absorbed, not only the surplus thus left, but
3,000,0001. from the B.nk, in addition to an extra oae or I
two millions in notes. As the amount of omeremey wed 1
for internal purposes rarely *apeman any great or per-
maacont fluctuation the Bank dhootors were goaded to as-'
some, week by week, as the absorption became more is.
mutable, that a tam must be rapidly irksome% and that
the market would them be over-supplied with the amounts '
pointad besn so strangely removed from it. But there was
a below which, whatever might be their 000lldenao
as to the supply of money actually available in the
country, they could not allow their reserved nets. to fall,
and that point having been reached ten day& ago the pro-
seat measures oometenesd. And here, again, nothing but
abnormal results were whammed. With a rise of half per
cent the demand still increased, and an additional move-
ment of one per met seemed to burs so restrictive effect.
Thus the reserve. although it the peculiar cireumetsaess of
the can perfectly sufficient for safety, ban been ao dimi-
nished as to prevent an unsatidaotory appearaeos. and, as
the paymest of the dioridends which takes plaosnext week is
usually followed by • sebetracties d et least 600,0001., it
was aseutial that no time should be lost is making • fur-
ther movement that should decisively test the actual limit
which will put a stop to the competition. All the evil
that eau have bees caused by MT previous la akes.
on the part el the Book aunt simply consist in their
having unduly stimulated the iedustry of the Geometry
by kiting out capital too cheaply, and, at ell sweats, the
correetiou ham been applied in time to provost any mato-
vial iteconvonissee. Some persons will be dlspoeed to
fancy that the industry of IDS Gantry seam, be aver
stimulated, amesaially so keg as the foreign eachangen are
in our favour; but employmeet,strained. leads to
the payment of preposterous ways, greet dearness in our
manufactured goods which will ultimately check their sale
In distant plows, sod the amerimptioe of imported articles
cm • smile that would vary soon tan deo tide vioisetly
easiest Whits, therefore, we may reogratniaks our-
selves that the eikting profits of bunions have been shown
to be snob es to rimier • 6 per met. rate for mosey a matter
of so considerstioe, stone lave et length ham Indy takes
to pmmut this sdisassassr7lsetivity frost nosiviag a falai
Impedes by • nea-maintommes of the matand emeeloet rela-
tes& Wires& mailed and labour.

--
Cummins GAZDINII.—The lest fete in these pr-
ams teethe /0011011 will take pace to-ray. ter the bee
Mr. Adams, whoa has for tba LA fifteen yeas Glaa the
aka d earretery, s variety of ereamearnt• ere eanceuxed.
lasia•Ws • eaeaert, • oasis ballet, sod • display at Gre
nada. The pears dam this evade&