New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-06-24
The Dollar in Foreign Exchange

The foreign exchange market has
been under the influence Of the pro-
nounced tightness Of money during
the past week. Hardening in money
rates, which are holding around the
highest levels Of the year, tended %
induce irregularity in exchange trans
actions. In the case Of English and
French exchange the demand from the
banks for higher interest returns Oh
credit accommodation resulted in the
rates declining fractionally, sterling
going TO s475% momentarily and
francs to SO. Subsequently there
was a recovery, following the unusually
heavy receipts Of gold from Ottawa on
British government account.
Resumption on the gold import
movement is bound up closely with the
sterling exchange situation. The gold
serves two purposes. L helps 70 main
tain sterling rates at a so-called peg
level and adds 20 the supply Of money
available as basis for the credit ex-
pansion. Approximately $52,O90OOo o.
gold was brought in during the week,
and the movement is not ended, as 10 is
understood that the bankers propose 20
import at least S15O0OoOoO at this
time.
Additional gold was taken Tor export
20 Japan and Spain. such shipments ag-
gregating about S7,00O000. Spanish
pesetas were somewhat easier carly in
the week. but the undertone continued
distinctly firm. japanese exchange in
still favorable 70 gold exports, although
the extension OF a S25.O00,0O0 credit TO
France by japanese banks is expected
to relieve the necessity, temporarily at
least, of withdrawal Of gold from this
centre.
Despite the extension Of a s25,000,000
credit to Italy by London banks and the
fact that the United States has granted
substantial financial aid TO the Italian
government &c assist in the payment %
war supplies purchased here, exchange
on Rome declined quite sharply during
the week. lire falling from rate of
7.05 to the dollar 10 7.40 toward the
end. Selling OF lire from Italian
sources was the explanation Of the
downward movement. Swiss francs
were strong and touched the highest
level of the war period. Buying Of
Swiss exchange is said TO have been
done on considerable scale by inter
ests here which convert the Swiss
franc bills into marks in Switzerland
and by this means effect pay ments IN
Germany.
German marks are said 10 be avail
able in Switzerland now at rate of
about 1914 cents apiece. This COM
paros with a quotation of around =
cents at the last date on which deal
ings in marks were permitted in this
market. Since the United States en-
tered the war all dealings in marks
and Vienna kronen have ceased. I'm
connection with the depreciation in the
exchange value of the German mark
some interesting news came out OF An
sterdam. Holland. last week The
"Rheinische Westfalische Leitung,' the
National Liberal and industrial organ
of Germany, published an editorial
charging the decline in marks 20 Amer
lean bankers. who, IL was stated, had
in one day thrown 90. 900 900 marks on
the Rotterdam market. Bankers here
denied the German charges and as
serted that the trouble with the reichs-
mark in Holland and Switzerland Is
that Germany is on a paper basis and
the printing presses are working az top
speed 20 keep the output Of paper
money within the empire equal 20 the
demand.
II YOU calculate the cost Of the dollar
in terms Of foreign money-that is. as
II YOU were buying dollars with pounds
marx. OF francs-its value az the close