The Sun.
London, England, 1857-04-03 00:00:00

RISE IA THE RATE OF DISCOUNT.

The 133rk E-glard yestt-n'ay raised their nit() of
di.count from 6 per cent., at vinicL. it hn l stood since
Dec. 18, to 61 per cent.

The usea-ure cr,:red general surpri,e, although the
gold withdrawals and the extreme press:ire for discounts
during the past week ❑ught have sugt,eited its prob -
bility. The • next Gazette returns will, it is believed,
prove that the decision is in harmony with recent pre-
cedents. Those who are diesatisfiect with it urge that,
as the payment of the dividends will shortly take place,
and there is also a prospect of good supplies of gold
and silver from Austialia and rireico, and of the
drain for the Bank of France and Lelia diminishing,
a delay of a week or two should have been allowed.
The true policy of the Bank, however, is not to trust
to contingencies in any case, and in the face of a re-
moval of half a million of bullion in the course
of a few days, not for any exceptional and terupYary
object, but to meet requirements from France, Brazil,
India, China, the Cape of Good Hope, and the West
mere was certainly no reason for hesitation. It
is true there are grounds forassurning thattbis unfavout.
able state of our balances with foreign countries cannot
much longer continue, since, if our extraordinary trade
is really sound and profitable, its profits, unless they are
dispersed by an extrava4ant expenditure, must some day
exhibit themselves ; but she most experienced persons
have now for several weeks looked confidently for a
turn, and have found only that the pressure is increas-
ing. Still should the anticipation of a more easy period
se suddenly realised the Bank are not tied to their pre-
sent rate even for a single week. That in adopting it
they have not got beyond the point which the natural
condition of -the market dictated has already been proved
by the fact that the demand this afternoon at 6i per
cent. has shown scarcely any falling off.
The increase applies alike to discounts and to loans
upon securities.
The discount establishments have increased their
allowance for money at cell from 51 to 5:1 per cent.
The rate of the joint-stock banks for deposits will be
5t per cent.
The expediency of the Bank being guided in their
discount arrangements by the amount of their bullion
and the state of the money market, instead of pausing to
see if certain things may not happen to render a change
unnecessary, has been illustrated i❑ the results of their
downward movement in December last. That step wa■
much criticised at the time, because many persons
thought it would have to be retraced in a week or two,
and the public were charged with having clamoured
impatiently for relief. O❑ the opposite side it was
• argued that the Bank should be guided day by day
• solely by the facts before them at the moment, and not
by any conjectures, however rational, as to the course of
future events. The experience of that case has since

shown how deceptive .such conjectures may prove.
The reduction occurred nearly four months ago, and
until yesterday no alteratio❑ has been found necessary,
the interval of freedom from change having been consider.
ably beyond the usual average.—Times' City Article.