The Australia and New Zealand BankingGroup Ltd in New Zealand said it will raise its indicator
lending rate to 23 pct from 21.5 pct on April 7.
    A bank statement said the continuing rise in the cost of
funds had to be passed on to the lending customers.
    ANZ managing director Brian Weeks said: "Recent developments
in the money markets are of deep concern to all participants
... Market participants are understandably nervous and cautious
about future developments.
    These include flows to and from the government relating to
the privatisation of seven government departments on April 1.
    "We welcome the flexibility evident in the Reserve Bank's
move to raise the system cash target yesterday, but feel that
to reduce the present nervousness the cash target and primary
liquidity level need to be raised further...," he said.
    The Reserve Bank has raised its daily cash target to 45 mln
N.Z. Dlrs from its normal 30 mln dlrs.
    Call rates have traded as high as 65 pct this week because
of business year-end March 31 balance date book squaring.
    Westpac Banking Corp in New Zealand announced yesterday it
would increase its indicator lending rate by 1.5 percentage
points to 22.5 pct on April 7.
 REUTER



