Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-04-19
FOREIGN ECONOMIC
SENTIMENT CL|NGS
-7OCHEERFUL VIEW
Strengthening of Commodity
Prices and Gain in EN-
pIoyment Noted.
STOCKS OF GOODS LOW
PENDING BETTER DEMAND
Heavy Industries Expect Improve
ment-Market Changes Dis
counted by Trade.


NEW YORK, April 18.-Cable dis
patches to the Business Week give the
following survey of business abroad for
the week ending April 49,
Europe.-The proclamation Of the
Spanish republic, though primarily of
local significance, has focused all at
tention. The week otherwise was tea-
tured by contamination of the sugar
and lead restriction agreements and
uneven but general strengthening of
commodity prices from their recent low,
the reduction Of unemployment-espe-
cially in Germany-and conclusion OF
the, RusSo-Gernan trade agreement,
under which contracts may reach 125
million.
Seasonal impulses are beginning to
wane. The most nctable are cotton
textiles, where the activity of four
weeks ago, which was beginning to
assume boom proportions, has dwindled
rapidly. The decline partly is attribu-
table to the weakness of American cot
ton. Indications of price stability will
revive demand. On the other hand,
the heavy industries, though showing
no appreciate immediate change, in
creasingly express expectations OF i'm
provement.
Sentiment Continues Hopeful.
Business sentiment has held sur
prisingly firm in recent weeks, not
withstanding the recurrent weakness of
commodities. and fresh political uncer-
taintieS. Confidence seems general that
the defiation cycle fundamentally has
passed its nadir and that an increasing
vacuum of unsatiSfied demand lies
somewhere ahead. Confidence in the
underlying upward trend is not shaken.
Market ViciSsitudes are accepted as a
more CT less inevitable accompaniment
of the changing business cycle. Never
theleSs, future commitments are not yet
being undertaken except in rare cases
nor are low factory and trade stocks
being Teplenished. Investment conf
dence remains heSitant and highly Sc
lective toward new financing. Till this
hesitancy Of new commitments thaws.
it cannot be said that confidence has
been .re-established.
LOndon.-The Easter aftermath has
slowed trade. Cotton is uniInproved,
but there is slight demand for light
bleaching cloths from India and China.
Recent rayon recovery has lulled. Stock
markets were better till Monday, when
there was some recession. Business
throughout lacks volume.
The possibilities of the budget. to be
announced on April 27, now dominate
exceed lis millions. The chancellor
actually budgeted last April for sur
plus of Is millions. 1t was at one time
anticipated that the deficit would reach
$50 millions. and, in so far as this
gloomy anticipation has been falsified
by the good flow Of revenue toward the
end of the financial year. traders are
cheerful. But-a thing that the ordi-
nary citizen too often ovarlooks and
all chancellors remember deficit in
l930-3l is very different from a deficit
in 1922. 1t is that anticipated deficit
which will govern the budget
Employment Gains.
Budget uncertainty at this time OF
the year always hampers trade. but this
year. there is the added uncertainty as
to what may be the prospects of reve-
nue. tariff. 1t is unlikely that Snowden
will impose such thing this year, but
1t is a possibility.
Berlin.-Anotber week has strength
ened. the widespread confidence that
business has passed the period of black
est depression, Is definitely on the mend
Principal supporting factors: % sub
Stantial reduction of unemployment
(224,000 in the second half of March, !:
~ continued firmness of the bond
market: go strengthened prospect Of a
lower bank rate in mid-April: "a
stimulus afforded by the anticipation
Of worldwide INCORPORATION develop
ments.
Financial prospects are improving.
Cheaper money is in prospect. The
private discount rate dropped to As
per cent this week, justifies hopes for
II per cent cut in the bank rate
present rate, 5 per cent? after mid
April
Unemployment is falling of encour-
agingly, but it is too early to turn
strongly optimistic over the new trend.
Paris.-Apart from the further ex-
tension Of wage reductions, business
continues to be depressed and feature
less.
February industrial indices, just re-
leased, show insignificant changes aver
aging per cent below those of last
year. March railway traffic showed a
further slight decline, is now below the
1928 average. Registered unemploy-
ment for the two weeks ending April
showed only fractional increases follow
ing the rapid rise of the previous sew
eral weeks
Wholesale prices for the second week
in April showed a distinct upward
trend. with domestic products and
foodstuffs again leading under the in
huence Of recently increased tariffs.