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Thursday, 9 December 1971
Page: 4525

Mr Barnard asked the Treasurer, upon notice:

(1)   Were the trading banks notified of the Government's decision to increase advance limits by $5m per week before the Prime Minister's announcement in the House on 26th October 1971.

(2)   If so, on what date were they notified and what was their assessment of the feasibility of lending at the level proposed by the Prime Minister.

Mr Snedden - The answer to the honourable member's question is as follows:

(1)   and (2) In early October the Reserve Bank, after consultation with the Government, informed the trading banks that no objection would be raised to some increase in the level of their new lending which had been under considerable restraint for a long period. When consulting with the Government about the likely impact of this measure, the Reserve Bank indicated that the possible increase in new lending above recent figures might be something of the order of $5m a week over the coming months.

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