ABSTRACT
Exchange Markets: Sydney (1822-1914), Melbourne (1851-1914) and Adelaide (1838-1914)
Sources: Sydney: PRO London, CO 206: Blue Books of the Colony of New South Wales (18221845); BUTLIN [1953], pp. 623-626 (1826-1851); BUTLIN / GINSWICK / STATHAM [1986], p. 58 (1835-1850); The Course of Exchange, London (1849); BUTLIN [1986], pp. 333-337 (1851-1875); Sydney Herald (Sydney Morning Herald) (1846-1849); The Economist, London (1849-1894, 19081914); Statistical Register of New South Wales for the Year 1871, Sydney 1872, p. 189 (1871); The Sydney Trade Review (1894-1911). Melbourne: PRO London, CO 313: Blue Books of the Colony of Victoria (1851-1854, 1860-1863); BUTLIN [1986], pp. 338-341 (1851-1875); The Economist, London (1855-1914); Statistics of the Colony of Victoria for the Year 1872. Compiled from the Official Records in the Registrar-General’s Office, Melbourne 1873, Part IV: Accumulation (1872). Adelaide: BUTLIN [1953], pp. 696f. (1838-1851); PRO London, CO 17: Blue Books of the Colony of South Australia, vol. 13-31 (1841-1858); BUTLIN [1986], pp. 343-345 (1851-1875); The Economist, London (1881-1914). Concordance: WdW IV, pp. 321-335
Currency at Sydney: After the setting up of New South Wales in 1788 there were neither coins nor any other kind of transactions with money in the first British colony on the Australian continent. Until 1822, in the “age of barter and tokens” (CHALMERS [1893], p. 242), a few imported coins (above all Spanish dollars), sales receipts, which “passed from hand to hand and constituted a paper currency which could be at any time exchanged for a sterling bill” (ibid., p. 243) on the London Treasury, and several other promissory notes served as means of payment. “Within this miscellany, sterling was frequently employed as a unit of account despite its limited availability as a medium of exchange” (BUTLIN [1994], p. 132), but “in the early nineteenth century ‘sterling’ very rarely means English money. Occasionally it means pounds, shillings and pence, as opposed to reckoning in, say, dollars or rupees. But in general it referred to Australian money, expressed in £ s. d. of a kind distinguished from ‘currency’. ‘Colonial currency’, which by an easy transition became simply ‘currency’, meant media of exchange having a purely local circulation and often a very limited acceptability. Before 1810 it meant primarily copper coin, promissory notes and at times wheat” (BUTLIN [1953], p. 65), later on also dollars. The premium on sterling in ‘currency’ was 20% in 1811, 33.75% in 1812, 43.75% in 1813, 25% in 1814, and 43.75% in 1815 (average values of quarterly rates; ibid., p. 99). Although it was officially laid down in 1816 that in the case of a reorganization of the colony’s monetary system the sterling with the pound of 20 shillings or 240 pence (see pp. 3-5) was meant to be the only currency, Spanish dollars were imported on a large scale during the 1810s and in the first half of the 1820s, and dominated the coin circulation of the following years, although they were overvalued. The era of the “supremacy of the Spanish Dollar as the actual standard and measure of value” (18221829; CHALMERS [1893], p. 242) was on the one hand characterized by the fact that payments within New South Wales and abroad were generally settled in Spanish dollars until 1829 – either in bills of exchanges (with London) or in cash (with China) – while on the other hand this coin was officially valued differently (since 1823): the same dollar – according to its silver content equal to 4 shillings 2 pence – was paid out by the colonial government at 5 shillings for purchases, at 4 shillings 8 pence to
dollar only at 4 shillings 2 pence. With this “popular revolution in the local currency” (ibid, p. 249) the “substitution of a sterling standard” (1829-1851; ibid., p. 242) began. After the second half of the 1820s such large quantities of sterling currency were imported that “a dual dollar-sterling system existed” (BUTLIN [1994], p. 134). “By the early 1830s, Australia was established as part of the sterling area” (ibid.) despite the financial crisis of 1834 and inflation from 1839 to 1841. As early as 1832 the Spanish dollar was everywhere accepted at 4 shillings only. When gold was found in New South Wales in 1851, “a sudden and revolutionary change in the internal trade” (CHALMERS [1893], p. 251) was the result. So, gold dust was a common means of payment for buying bills of exchange by the 1850s (NOBACK [1877], p. 861). In 1853 a mint was established in Sydney, in 1855 British gold was declared to be legal tender and Australian sovereigns were issued and became legal tender in the whole British Empire in 1866. “So the gold discoveries in 1851 finally ended the colonial dependence on British specie supply and, indeed, Australia quickly became not merely a source of gold for minting but in fact became a source of coinage for other parts of the empire, particularly in India” (BUTLIN [1994], p. 91). In 1871 it was determined that all coins minted in Sydney should have the same weight and fineness as those issued in London. Currency at Melbourne: In the 19th century in the colony of Victoria, separated from New South Wales in 1851, with its capital Melbourne, the currency developed, i.e. the pound sterling of 20 shillings or 240 pence (see pp. 3-5), largely in the same way as that of New South Wales (see above; CHALMERS [1893], p. 263), although the setting up of a mint in Melbourne lasted until 1869. The coins minted there became legal tender in the whole British Empire as well. Currency at Adelaide: In South Australia, constituted in 1837, exchange transactions were also carried out in pounds sterling of 20 shillings or 240 pence (see pp. 3-5). “The currency of South Australia has little or no history” (CHALMERS [1893], p. 275). Currency in the Commonwealth of Australia: When in 1901 the Commonwealth of Australia was constituted, the sterling currency was kept as legal tender in Australia. In 1911 the pound of Australia was introduced, which was equal to the former pound sterling.
