The New York herald., 1922-02-23
FRANCS RISE WITH
SLUMP IN IMPORTS
Plenty Of Raw Material on
Hand, Asserts Bank of
France Director.

Special Cable to TIE NEW YolK HnsAp.
Copyright, 1898, by THE NEW YoRK HERALD.
New York Herald Bureau
Paris, Feb. 22.
In an important interview given to
the correspondent for THE NEW YORK
Herald to-day A. Aupetit, Director
General Of the Banque de France. ex
planned the remarkable rise of the
French franc in the last few days as
due to principally tho recent steady
decrease in Frances importations. be-
cause she now has enough raw material
on hand to meet her needs for the next
few months"
1t was a resume of the Banque de
Frances annual report, as published in
THE NEW YORK HERALD, which first
called attention to the remarkable i'm
provement In French finances and gave
an intimation Of what has happened
since to France. When asked by the
correspondent to-day to explain the
latest financial phenomenon the di-
rector OF Frances greatest financial In
stitution added:
"But it must be remembered that
there are other factors involved. al
though admit that the popular theory
that there has been heavy speculation
doesn't enter greatly into the present
movement. We are accustomed to these
fluctuations but we are gratifed that
the medium Of the francs value con-
tinues to improve, Notwithstanding that
we are burdened with heavy exterior
war debt, as we'll as forced to pay for
the devastation caused by Germany. AS
soon as the latter phase Is settled the
improvement will be more general and
more rapid than It has been since the
armistice."
According to NJ. Aupetit, who is rec
ognized as one of the most able experts
In France, first, the decrease in i'm
ports naturally caused q drop In prices
abroad, which will increase slowly un-
til the French manufacturers resume
their heavy exports and thereby Will
require new rawstuffs; second. undoubt-
edly the recent loan by American and
British bankers to the Department Of
the Seine caused advance purchases Of
francs. which had some influence upon
the rise Of tho franc although this fac
tor is not considered seriously In some
banking circles; third. the announced
reduction in the Bank Of Englands dis
count rate to AZ per cent, while the
French rate still is 5 per cent, caused
flow Of pounds sterling to countries
offering better advantages, this move
ment being accentuated by the simulta-
neous lowering of the value Of sterling
compared with that of the French franc /;
fourth. the British labor crisis coupled
with lowered production and exports
completes the circle, for as long as ex-
ports are not going out the prices In
England must be lowered in order to
1Ax - ill.,
the franc upward several points daily
There is no telling where such a
movement will halt" NJ Aupetit re-
marked. 1--WE are confident that as
far as we are concerned the slow and
steady amelioration which has been evil
dent since last year will not suffer
by the present drop in the value OF the
dollar" But some French manufac-
turers are predicting that continued
fall, unless prices In the United States
greatly decrease, will prevent the
French exporting to America on as large
a scale as last year
Pierre Sabatier of the Compton Ma
! tional dies Comptos considers specula-
tions largely Influenced by the Bourse.
but also sees q possibility of the British
taking steps to balance the pound ster-
ling against the franc in order to facil-
itate trading operations between the two
countries. this movement carrying with
1t reduction in the value OF the dollar
M. Verder of the Credit Lyonnais
likewise says: "The basis of the whole
thing is speculation and when such a
movement starts in London and New
York takes hold the situation will con.
tinue until they begin to realize their
profits. Then 1t stops" NJ. Verdier
sees no great effect coming out of tho
Genoa conference as far as exchanges
are concerned. at least until the results
of the conference become internationally
apparent.