The herald., 1893-08-17
THE INDIAN COUNCIL WEAKENS,
Drafts offered for Sale at a
Reduced Rate.
An Acknowledgment Of ITS Recent
Mistake.
1t Looks as Though India Had . Hank
ering to Reopen Her Mints
to Free Coinage
of Silver.
By the Associated Press.

LONDON, Aug. 16.-The market was
surprised and disturbed today by the
sale OF Indian council drafts at 1s sgd.
When the Indian mints were closed to
free coinage OF silver, the council fixed
the rate for drafts at Is 4d, and the sud.
den reduction has caused general feel
ing OF uneasiness. A tender for bills at
Is 31sd was refused. In consequence oi
the reduction OF the price Of drafts, rupee
paper dropped 11sd.
LONDON, Aug. 1.-THE Times in a
financial article this Thursday morn
ing says; "Denver and Rio Grande,
preferred, was quoted higher yesterday.
owing to an absurd impression that the
Indian government was about to reopen
the mints to silver. Whether the de.
cision taken on this subject be
wise or not, it is not at all likely
that the government will interrupt it so
soon ae this. The origin Of the rumor
was the action of the Indian council in
selling drafts at Is. SID. From the be-
ginning 1t Was doubtful whether the
council would be able to force the mar
ket to buy on their own terms. In fact,
Indian exports would be Immediately
contracted and Indian imports ex.
panded, thus simultaneously reducing
the demand for and increasing the sup
ply of remittances to the east. This, we
must assume, has been overlooked, or
not sufficiently allowed for. Moreover,
no account could have been taken OF
other means of remittances which at q
pinch could be and actually were made
use OF, such as rupee paper and even
silver. On the other hand, we
fear the majority OF the coun-
Gil overestimsted the rapidity with
which the cessation Of coming would
begin to give the rupee monopoly
value. This is q matter on which it
would be foolish for any outsider to
offer an opinion, but arguing on purely
prior grounds it should certainly be
thought rash to assume that cessation
of coinage of less than two months could
possibly affect the value OF an article of
which so large an amount was known to
be in existence. Perhaps the stoppage
OF mintage for few years may produce
some effect, but even that is in no way
certain"
The Standard regards the Indian coun-
ellis action as complete confession Of
failure, seldom parslleled in the action
of governments.
The Financial News says: "What
further results will flow from the Indian
councils action, it is impossible to fore
tell. 1t virtually nullifies the step taken
on June 26th, anj logically must sooner
or later lead to the question whether
after all 1t is not better for the Indian
government to admit ite blunder and
reopen the mint"
NEW York, Aug. 16.-London cables
received in Wall street this afternoon
reported that the Indian conncil had re-
oeded from the position it took when 1t
closed the Indian mints to free coinage
Of silver, and were selling council bills
below the arbitrary fixed rate of 1s 4d.
Theiaavices were msager and did not
state whether the mints had been re-
opened. In the absence OF definite
news, it WAS supposed the council had
been unable to maintain the rate of
exchange OF India at the price
fixed. Few persons understood what
further changes might be expected
or why a reduction had been ordered.
1t was the original action Of the council
in fixing the rupee price and closing the
mints that sent silver from S3 to 81
cents an ounce. Today's announcement
created good deal of comment among
bullion dealers and others. Some deal
ere thought it meant the abandonment
OF the attempt to establish ageld stand
ard value for rupee. They were not go
sure, however, whether it indicated the
early re-establishing of free coinage or
not.