Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-11-07
ENGLISH BANK RATE RAISED
TOUCHES SEVEN PER CENT FOR
FIRST TINE IN YEARS.
Effect Of the Move Immediately Felt
on the Stock Exchapge-Ameri-
cans Still Buy Gold.

of the Bank OF England this morning put
tup the minimum discount rate from g to
I per cent. The only thing which could
have ayerted this heayy rate would have
been assurances from responsible quar-
tiers In New York that the situation there
which it Is recognized is due to the excep-
tional demands upon capital In conse-
fquence of the great commercial activity
in America Is sufficiently well in hand to
warrant the expectation that there would
be an early cessation Of the gold drain
on this market.
| In the absence of such an assurance the
Bank of England Utilized the only weapon
at hand to protect it's reserves. II Is
realized. however, that even this high
rate may not prevent shipments of gold
4 to New York. but Il Is hoped that Ii may
attract the metal from abroad in sufficient
quantities to restore the equilibrium. The
step was doubly necessary as the bank
must nurse its supplies just at present
| for the autumn country cash requirements
as well as the usual Egyptian demands.
and there is a possibility OF demands for
gold from Argentina
| The last occasion when per cent
rate was enforced ~ the Bank of Eng
land was in 1873, and was due to financial
troubles on the continent and in America.
| On that occasion the rate eventually
reached per cent, but it quickly fell to
~.
Stock Exchange Feels It.
The local business community Is bound
| to feel the pinch. and the f1nanciers an
| ticipate that the drastic rate will cause
| an even greater squeeze in Germany. with
la consequent increase Of the discount
| rate Of the Imperial Bank and selling
| orders from Berlin
The announcement of the increase of
the Bank of Engiands rate by full
point had strong effect on the stock
a-18 higher owing to the settlement Of
the railway dispute. Immediately fell half
point. Home rails started ! to points
dearer. but lost most Of the advance
within a. few minutes. American rails
had similar experiences. The opening
prices ruled around parity. but 3 drop
of point followed Immediately after the
publication Of the bank rate, and selling
| brought quotations at noon down to B
points lower than yesterday. 1t was not
| the market fully realized how heavy had
| been the drain on the gold reserve. The
! figures showed the weeks decrease to be
| f3, 13S,SO7 the total reserve being Ell
G94, 705. against E2O. s33. COZ last week and
f18O78. 395 at this time last year.
| There were inquiries in the market this
| morning for another 81 100000 In gold
| for America.
Effect on the Paris Bourse.
PARIS. November THE increase In
the discount rates Of the Rs-s 81 Err. Err
| land and the Bank of France adversely
| affected business on the bourse here to-
| day. and the heaviness was increased at
| the close by a fall in Portuguese govern
| ment securities. caused by the high pre-
| MUM on gold at Lisbon. which rose yes
| terday from GA to per cent.
|
| considered the increase In the discount
| rate to be imperative in order to protect
| the Pals money market from the drain
| to which 1t has been subjected by the high
| rates prevailing In other markets. as we'll
as the high exchange rates.
The DECISION to relieve the London mar
| ket OF It's excessive demands Is shown by
| the large increase In the Bank of Frances
| the rate on loans above the discount rate
being taken for the special purpose Of dis
couraging the foreign demand
At the same time the Bank Of France
| advanced the rate On loans from to Az
| per cent.
Belgian Bank Rate.
| BRUSSELS. November THE National
Bank Of Belgium today raised its dis
count rate from 81 to per cent. and it's
rate on drafts to 81 per cent
Further Gold Imports.
| NEW YORK, November THAT the
end of the movement Of gold from En-
gland to America has not been reached
was shown today when Goldman Sachs
& Co. announced the engagement of
81 .625 900 for import from London.
| Kuhn. Loeb & Co. also announced that
| they had secured $500, 600 in Europe. This
| makes the total for the movement $780,
| 175.0O0.
Gold bars and coin to the value of
| 81. 600. GOO arrived today On the liner leu
| tonic. OF this amount 100000 goes to
Heidelbaeh. Ichelheimer & Co. Of New
| York; 81 100000 to the Bank of Montreal,
and SEC. Gee to the Bank of Nova Scotia.
| The subtreasury today transferred for
banks currency to the amount Of 81, 49,,
COO OF this amount $S50,09 went to San
Francisco. $137, eco to Philadelphia, $780,
600 to Denver and $4,000 to New Orleans.