Exchange quotations are not published from many of the British colonies, as their financial business is in the hands of a comparatively few excellently managed banks, which establish, by agreement, conventional exchanges fixed for a considerable period, notably in the case of Australia, New Zealand and South Africa. The Scottish and Irish banks supply similar examples of a monopoly in exchange.

The following table taken from the money article of a London daily paper indicates the exchanges which are of most interest to England:—

Foreign Exchanges.

June 14. June 15. June 16.
Paris, cheques 25 f. 18 c. 25 f. 18 c. 25 f. 18 c.
Paris, Mkt. discount 2½-5⁄8 p.c. 2½-5⁄8 p.c. 2½-5⁄8 p.c.
Brussels, cheques 25 f. 23 c. 25 f. 23½ c. ..
Berlin, sight 20 m. 48¾ pf. 20 m. 48¾ pf. 20 m. 48 pf.
Berlin, 8 days 20 m. 46½ pf. 20 m. 46¼ pf. 20 m. 45½ pf.
Berlin, Mkt. discount 37⁄8 p.c. 37⁄8 p.c. 37⁄8 p.c.
Vienna, sight Holiday 24 kr. 02¼ h. 24 kr. 02¾ h.
Amsterdam, sight 12 fl. 131⁄8 c. 12 fl. 13¼ c. ..
Italy, sight Holiday 25 lire 15 c. ..
Madrid, sight ” 27 ps. 68 ..
Lisbon, sight ” .. ..
St Petersburg, 3 ms. 94 r. 10 94 r. 10 ..
Bombay, T.T. 1s. 4d. 1s. 4d. 1s. 4d.
Calcutta, T.T. 1s. 4d. 1s. 4d. 1s. 4d.
Hong-Kong, T.T. 2s. 11⁄16d. 2s. 11⁄16d. 2s. 11⁄16d.
Shanghai, T.T. 2s. 10¾d. 2s. 105⁄8d. 2s. 105⁄8d.
Singapore, T.T. 2s. 41⁄16d. 2s. 41⁄16d. 2s. 41⁄16d.
Yokohama, T.T. 2s. 03⁄8d. 2s. 03⁄8d. 2s. 03⁄8d.
*Rio de Jan’ro, 90 days 169⁄16d. 169⁄16d. 1617⁄32d.
*Valparaiso, 90 days Coml. 143⁄8d. 143⁄8d. 14¼d.
*B. Ayres, 90 days 481⁄8d. 48d. 48d.
* These rates are telegraphed on the day preceding their receipt.

In the case of Paris and Berlin it will be noticed that the local rate of discount is also given, as the value of money in these centres, in relation to the value of money in London, is the most important factor in a movement of the exchange. Vienna has become important owing to the improvement in the financial position of Austria, and still greater improvement is shown in the case of Italy, whose currency stands in the above list better even than that of France. Spain, which should stand at about the same rate, still has a depreciated paper currency. Lisbon stands also at a discount, as the milreis should be worth 53¼ pence.

In Russia the exchange showing 94.10 roubles to £10 is carefully and cleverly controlled in spite of the bad internal position. The India exchanges move slightly, as the currency is firmly established at the rate of 15 rupees to the £1. Hong-Kong quotes for the old Mexican dollar and a British trade dollar; Shanghai for the tael containing on an average 517½ grains of fine silver. The Straits Settlements have fixed their money on a gold basis at 2s. 4d. per dollar, on the lines of the arrangement made in India. In Japan there is a gold standard, and par of exchange is 2s. 0½d. for the yen. Brazil, Chile and Argentina have a depreciated paper currency, and the last quotation of 48d. is for the gold dollar equal to five francs, but there is a premium on gold in the River Plate of 127.27½% and for the present a gold standard is re-established on this basis. The letters T.T. with the eastern exchanges signify telegraphic transfer or the rate for payments made by cable. The very important New York rates are always given in another part of the daily paper with other details of American commercial interest.

These rates are all quotations for payments in England, and all over the world the exchange on London is the exchange of the greatest importance. This unique position was gained originally, probably, through the geographical position of the United Kingdom, and has been maintained owing to several reasons which secure to London a peculiar position by comparison with any other capital. Britain’s colossal trade ensures a supply of and a demand for English remittances. Even when goods or produce are dealt in between foreign countries a credit is opened in London, so that the shipper of the produce can offer in the local market a bill of exchange which is readily saleable. With the highly developed banking system a large amount of deposits is collected in London, and the result is that bills of any usance up to six months can be immediately discounted, and the proceeds, if required, can be handed over in gold. There are in London a great number of wealthy banks and banking houses whose reputation and solidity allow any one of them to accept bills for amounts varying from one to ten millions sterling, whereby large commissions are earned.

These four advantages, namely, a free gold market, a huge trade, an enormous accumulation of wealth, and a discount market such as exists nowhere else, have made London an unrivalled financial centre, and consequently bills on London are an international money and the best medium of exchange.

Authorities.—A B C of the Foreign Exchanges, by George Clare; Foreign Exchanges, by Goschen; Arbitrage, by Deutsch; Arbitrages et Parités, by Ottomar Haupt; Swoboda, Arbitrage (12th edition), by Max Fuerst.

(E. M. Ha.)