New Britain herald., 1926-05-15
DOLLAR EXCHANGE ON
 STERLING AT PARITY
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countered In February, 1920, when the cumulative effects of postwar disappointments were reflected in a veritable trading panic. A per pendicular break of 31 cents in four days carried the rate to the lowest point in history at s3.19.
 Brisk Rally Follows
 A brisk rally followed. An nouncement by the chancellor of the exchequer that the British treasury would pay off it's portion of the Anglo-French loan, and if necessary ship gold to the United States to accomplish the liquida- tion, initiated the upturn. There after rumors of gold shipments contributed to a steady advance, and although s48,000.o00 in gold which was consigned to the United States actually was for payment of an Argentine loan, the propaganda was effective in lifting the rate to s4.o6 5-4 by April 5. For the re- mainder of that year the course of sterling was governed by trade de- mands and gold shipments.
 Further recovery in sterling took place in 1921. when the price moved up from low of s3.53 1-4 to high mark of $4.24 1-8 late in the year. Among the factors which contributed to the improve ment were the settlement of many internal problems, approach of the Irish settlement and the favorable impression created by the disarma- ment conference in the United States. This year saw the rise of speculative activities in exchanges on scale hitherto unknown. These operations supplied much of the purchasing power which put sterling above the s4 mark.
 Htis High Record
 The gradual appreciation of sterling continued until December, 1922, when a violent upturn of about 20 cents in week to a high level at s4.69 attracted the worlds attention to England's recovery. The rise was aided by favorable trade figures, the better condition of the British treasury. the return to London of large balances by in ternational companies and the trapping" of & large number of spectators who had sold sterling for decline.
 By February, 1923, sterling at s4.72 IS had reached it's highest level since March, 1919. The un- certain trend of foreign political events, the growing strength of the labor party in England and unfav- orable trade factors. however, combined to force the rate down about 46 cents to s4.26 by Novem- Der.
 Capital Sent Away
 Accession of the labor govern- ment in England. coupled with vague talk of a tax on capital and fears of an inhationary policy, start ed a flight" of British capital to this country early in 1924 which de- pi Cootu 0AtI HIS Sllll luIIueT to } Si.EU. A turn in the tide came with the spring reaction in the stock market here, the extreme ease of American money rates and higher interest rates at London, all of which tended to attract funds back to the British capital.
 Acceptance Of the Dawes plan ac- tolerated the advance which gained momentum through the successful f1otation of the international loan to Germany and the return of the con- servatives to power in Great Britain. Despite an unusually heavy volume of trade and grain bills, due 10 GUS tomary autumn purchases, the final forward movement of sterling con- tinued almost without interruption until party had been attained,
 The high and low prices of sterl- ing for each of the last five years are shown In the following table:
 High Low