'The Chungking Government's view of the currency' situation was given In a United Press message from the capital yesterday in which a statement by a spokesman of the Ministry of Finance was given declaring that the drop in the dollar "need not setlously affect China's economy asa. whole."
The spokesman went on to say however, that it "was regrettable that conditions created by the Japanese Invasion of China and speculative operations had caused a fall In the exchange rate, He added that the increasing dimlculty in obtaining Imported goods and conditions which depressed the exchange rate might bbe' only temporary.
The spokesman said that 20 years ago the United States dollar" was worth less than the Chinese dollar, and the pound sterling was worth only four Chinese dollars. This temporary dislocation, he said, caused no anxiety in Britain or the United States at that time.
The spokesman said that in order to facilitate the acquisition of the most needed imports the Government had. heer -eontinuing to grant. sh. stantial amounts of foreign exchange. He. said additional measures introduced this month will finance' the Importation of those goods that are most essential to sustain the livellhood of the people and increase He said the new measures also would stimulate the export of Chie nese goods through ordin-ry channels of trade, thereby strengthening the
its ability to carry on the struggle. ountry's economy and, Increasing The spok said_ the Chinese Government had alw: endeavoured facilities for "Consolidated Bonds" Down Great excitement reigned in the Shanghai unofielal Chinese Government bond market yesterday when the" reported moratorium on the main bond, the "Consolidated Bond" caused the prices of all the five istles the bond to drop violently by §2 and $4.50 a8 compared with the previous day's figures, The drop is unprecedented since the outbreak of The first issue of the bond priced $52.00 showed a decrease of $4.50 while the second issue registered a drop of $8 being quoted at $44.40 The other three Issues priced $43.05, $42, and $43.35 showed a decrease of '$3.40, $3.00 and $2.05 respectively.
No official report has come from Chungking in regard fo the moratorium but reports asserted that the Chinese Government had decided to declare a moratorium on the bond.
Although the reports could not be substantiated locally, there were dications that such a polley might be followed by Chungking. The fact that the branches of the four Chinese banks in "Shanghai have promised fo receive the bonds os objects of "mortgages" indicated that Chungking would not pay, the capital and i terest of the "Consolidated Bond! which are due on July 21.
Informed Chinese circles stated. that since Chungking had declared partial moratorium on foreign debis secured on the Customs incom and since that the "Consolidated Bond" was secured on the "Kwang Vu" or the lof-over of the Custor fund it was very likely that a moratorium should be declared on the tion of the Japanese puppet bank north China made it' necessary for the Government to introduce restrictions." He said the Jo had further interfered with the Chiese currency by issuing large amounts of yen, military notes and "puppet bank notes."
Text read from the printed page and cleaned; old type leaves the occasional error.