832.5151/1130: Telegram
The Ambassador in Brazil (Caffery) to the Secretary of State
[Received 11:04 p.m.]
147. My 143 of June 15, noon.28 The Bank of Brazil today suspended all purchases of compensation marks. The Bank, however, will continue to sell compensation marks. The Director of Exchange states that this policy will remain in force until the Bank’s overbought position in compensation marks is liquidated. This decision resulted from a report from the Bank’s Bahia branch that German firms were offering exceptionally high prices for cocoa for the purpose of preventing the Bank from reducing its over-bought position in compensation marks which is now 22,000,000. The Director states that the German Embassy and German banks have registered strong protests. The Director further informs me that he will recommend a license system for imports from Germany.
Please inform Department of Commerce.
- Not printed.↩