Financial Notes
REACTION IN GOVERNMENT STOCKS. •
LAST week's reaction in Stock Exchange quotations for British Government securities has since developed into a steady decline, which has brought, the majority of prices down to the levels ruling about a fortnight ago, The relapse can be traced to several _factors, including the slightly firmer tendency of loan and discount rates and the approach of the end of the year, when the need for strengthening cash positions often leads to • realizations of gilt-edged " stocks. But. .probably the most potent influence making for lower prices has - been Mr. Chamberlain's discouragement, in his Manchester speech, of hopes of wide taxation relief in the - (Continued on page 856.)
Financial Notes
(Continued from page 854.) next Budget. Whatever may be the principal cause, a set- back is rather to be welcomed after a rise so pronounced and continuous as that recently seen in the gilt-edged market. Considerable speculation in one form. or another developed during the advance, and a timely check to operations of that kind is salutary. Meanwhile, despite the slightly firmer trend of rates in Lombard Street, underlying monetary conditions remain favourable to a high level of gilt-edged security values, and there is thus no reason to expect that the reaction will go very far.
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