The Consul General at Shanghai (Cabot) to the Secretary of State
[Received February 1—7:41 a. m.]
341. Unconfirmed rumor but coming from reliable source indicates that Central Bank was ordered by the Minister of Finance9 to release unlimited gold yuan currency to purchase commodities through large Chinese firms and Central Trust for shipment to southern ports. Purpose is to keep commodities out of hands of Communists and leave them gold yuan currency. Result locally has been an increase of local prices from 200 to 300 percent during 3–day Chinese New Year holiday. Gold yuan currency January 28 quoted at 320 to 1 US; quote today is 700 to 1 and gold bars advanced from gold yuan 15,000 per ounce to gold yuan 43,000 during same period.
Sent Department 341, repeated Nanking 260.
- Hsu Kan.↩