Agriculture-One Way Flow of Funds

October 8, 1973 According to certain calculations, the US payments position is expected to balance by the end of 1973 and it is only by the middle of 1974 that the US would have a small surplus. Even this modest forecast is based on many as- sumptions some of which are highly tenuous. The present trend in the US balance of payments is greatly influenced by large agricultural exports. Once the world agricultural situation returns to normal and with continued rise in prices of crude petroleum, the anticipated improvement in the US balance of payments may not materialise even by 1975. Thus tangible progress towards monetary reform, hinging as it does on improvement in the US balance of payments, appears a distant prospect.