823.51/1–2445: Airgram

The Acting Secretary of State to the Ambassador in Peru (White)

A–99. Reference Embassy’s confidential telegram no. 83 of January 24, 1945. The Department has been investigating informally [Page 1346] and confidentially through Federal Reserve Bank of New York, the dollar position of Peru in an endeavor to ascertain the reasons which impelled the Government to establish exchange control. At present Department’s data are preliminary and indicative of a trend rather than definitive and conclusive as to the actual movements. Briefly, the Department finds that over the last year there has been a weakening in the dollar exchange position of the Peruvian Central Bank and a decided strengthening in the dollar position of the Peruvian commercial banks and/or Peruvian individual accounts. Present data indicate possible decline of 5 million dollars in Central Bank position and substantial increase (possibly 10 million dollars or more) in commercial bank and/or private accounts. Data presently available do not break down the commercial bank-private dollar accounts, but the Department believes the bulk of the increase is in accounts of Peruvian individuals and firms, this term including any accounts for which Peruvian addresses are given on books of New York banks. This view is supported by statements of New York banks to Federal Reserve Bank of New York to effect that recent exchange difficulties are attributable primarily to failure of Peruvian exporters to deliver exchange to Central Bank.… Most of the data on which the foregoing tentative views of the Department are based pertain to 1944 and indicate that the tendencies described became especially notable in the latter months of that year.

The Department will continue its investigation and will inform the Embassy of the results by despatch.