London silver report for May 13
The course of the market has been downward upon the whole, but, as was only to be expected in view of prices so much lower than those which have obtained for months, the momentum has somewhat' slackened. When we recall that the cash quotation stood at Sid. on March 4, and is to-day 58}d.—a fall of 234d., over 30 per cent. in about two months—we realize that the forces at work must be very powerful indeed.
The descent this week was not continuous for, after falling to 60d. on the 7th., the price rallied to 61. 5/8d, on the sth. inst., owing principally to the covering of forward-sales of silver falling due. The reaction was not caused by any inquiry from India and China—the only quarters whence rea] substance could be given to the market.
The closer approximation of the price in New York to a dollar naturally imparted to operators a degree of caution, for it might possibly indicate some arrest of the phenomenal fall of these last two months, as a return to that quotation would bring in the U.S. Mint a buyer.
The general position of silver is not altered. Assuming that 5,000,000 ounces a year (U. 8. produced silver) were thus acquired, the world production less this amount—say 135,000,000 plus the very substantial amounts of melted coin from the Continent—would have to be absorbed, practically by India and China alone, for Europe is a heavy seller on balance.
The Mexican civil war has advanced another—_ stage, and Mexico City itself has changed hands. The question whether silver reduction in that country will hindered or not will depend mostly upon whether one of the contending parties succeeds getting firmly into the saddle. Which party that would be would hardly matter, for the Government interests in Mexico are obviously furthered by an encouragement of this vital industry of the country.
't has been reported that the export of silver from Turkey has. been prohibited. This is not the fact, though the export of gold is still forbidden.
We understand that the silver, to which we recently referred as lately withdrawn from the holding of the German Reichsbank against notes, is still in the custody of that Bank, but that it is considered as a mere commodity—silver being now demonetized in Germany, The Latin Monetary Union has sanctioned the minting by Belgium, for use in the Belgian Congo, of small coins made of an alloy of inferior quality to that employed in Belgium itself.
The substantial amount of gold that came into the London market was taken for India, South Africa, the Straits Settlements and South America. The London price varied from 108/6 to 107/6 per ounce, the latter figure prevailing May 1%.
"The Transvaal gold output for April, 1920, amounted to 686,979 fine ounces, as compared with 707.095 fine ounces for March, 1920, and 694,944 fine ounces for April, 1919. 7
Britain's "Light Weight"
Text read from the printed page and cleaned; old type leaves the occasional error.