Bluebook

Prefatory Note

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1

In some cases, original copies needed to be photocopied before being scanned into electronic format. All scanned images were deskewed (to remove the effects of printer- and scanner-introduced tilting) and lightly cleaned (to remove dark spots caused by staple holes, hole punches, and other blemishes caused after initial printing).

2

A two-step process was used. An advanced optical character recognition computer program (OCR) first created electronic text from the document image. Where the OCR results were inconclusive, staff checked and corrected the text as necessary. Please note that the numbers and text in charts and tables were not reliably recognized by the OCR process and were not checked or corrected by staff.

Content last modified 6/05/2009.

March 6,

1970.

CONFIDENTIAL (FR)

MONEY MARKET AND RESERVE RELATIONSHIPS

Recent developments (1) Preliminary estimates indicate that the adjusted bank credit proxy for February declined in the magnitude projected at the time of the last Committee meeting, but that estimated changes in the deposit components which make up the proxy differed substantially from projections. average,

Private demand deposits declined much more steeply, on

than anticipated, and contributed to a commensurately larger

than projected drop in the money supply; whereas time deposits, instead of continuing to decline sharply as expected, showed virtually no decline at all.

The table shows how projections of changes in these variables

for February were revised as the inter-meeting period progressed. Weekly Board Staff Projections of Changes in Monetary Aggregates for February-

Projection Date February

March

1/

6 13 20 27 6

Money Supply - 2.5 - 7.0 - 8.5 -10.5 -10,7

Time Deposits -10.5 - 5.0 - 1.5 - 0.6

Adjusted Credit Proxy -7.0 -7.0 -7.0 -6.3 -6.3

Figures show the change from monthly average of January to the monthly average of February computed at a seasonally adjusted

annual rate.

FINANCIAL MARKETRELATIONSHIPS Money Market

P

eriodReserves

Borrowings Perio Mare. (In millions of doKIII_ dollars for weeks ending

Monthly 1969--January February March April May June July August September October November December

- 491 - 580 - 635 - 844 -1,116 -1,078 -1,045 - 997 - 744 -1,006 - 975 - 849

(Monthly averages and Indicators

Federal aBnl Funds Rate /

IN PERSPECTIVE of daily figures

where available, w ekly averages Bond Yields '

3-month

U.S

Treasury

Government (20 yr

Bill

in)

orporate Nlew Isues

Ji low o'

Nonboriroud erv

(aa)ii

(Aaa)

4t .

I vs.

o 1II ,vii t-ve"

(In millions

2/

ol

Bank Credit

[ink td Crdtad Proxy n b

dollirs)

(in

and Money,

Money Supply Sl.Ii

S A

lime DeposA, 3/

billions

t dollars)

715 836 837 1,031 1,359 1,355 1,311 1,211 1,026 1,189 1,213 1,127

6.30 6.64 6.79 7 41 8 67 8.90 8 61 9.19 9 15 9 00 8 85 8 97

6.14 6.12 6.02 6 11 6.04 6 44 7.00 6 98 7 09 7.00 7.24 7 82

5.99 6.11 6.22 6.03 6.11 6.28 6.27 6.22 6 55 6.50 6 74 6.91

6 92 6.91* 7.37 7.17 7 22 7.58 7.63 7.65* 7.98* 7.89 8 32* 8.75

4 58 4.74 4.97 5.00 5.19 5.58 5.61 5.74 5.83 5.80 5.88 6.50

4103 -112 -182 -270 +134 -183 -430 - 61 +169 -173 +128 +268

- .2** - 0.3 -2 5 + 1.2 - 0.3 -2 5 - 4.6 - 2 7 +04 -2.2 +23 -0 1

+ 1 0 + 0 5 + 0.5 +13 + 0.2 + 0.7 + 0.3 - 0.3 -+ 0 1 + 0 2 +0.3

-1 7 - 0.8 - 01 -- 0.6 -0.9 - 3.1 - 3.2 -0.4 -06 -0 1 +07

-

745 951

928 1,126

8 98 8 98

7.87 7.13

6.92 6 67

8.46 8.30

6.38 6.19

+170 -405

- 0.9 - 2,2

+ 1 6 - 1.7

- 2 0 - 0.1

3 10 17 24

-

838 349 886 901

1,240 740 1,018 1,105

9 57 8.57 9 07 9.61

7.01 7.09 7.11 7.13

6 35 6,45 6 49 6.60

7.90* 8.02* 8.04 8.13

5.80 5.85 5.85 5.82

- 65 +493 -323 -165

+0.7 - 2.1 + 3 4 - 2.1

+ + -

0 6 0.2 0.3 1.3

+01 - 0.1 + 0.3 - 0.2

1 8 15 22 29

-1,116 - 828 -1,129 - 857 -1,099

1,436 964 1,347 1,015 1,179

9.11 9.43 9.68 8.68 8.39

7.07 7.00 7.02 6 94 7 00

6.76 6.65 6.46 6.29 6.50

8.22 8.10 7.95 7.82 7.87

5.83 5.80 5.75 5.80 5.84

+163 - 71 -316 +545 -531

-0.8 -05 - 1.8 + 2.2 - 0.7

+ + -

-1 3 0.9 1.2 1.4

+0.3 -0.4 - 0.3 - 0 3 + 0.1

Nov

5 12 19 26

-1,031 - 873 - 925 -1,072

1,328 1,244 1,071 1,210

9.07 9.32 8.79 8 32

7.01 7 14 7.16 7.44

6 59 6.66 6 78 6.83

8.13 8.27* 8 44 8.67

5.75 5.78 5.95 6.05

+370 - 20 +490 -282

+ -

2.6 0.1 0.2 0.2

+ + + -

0 2 1.0 0.4 0.9

+ +

Dec.

3 10 17 24 31

- 988 - 903 - 946 - 832 - 576

1,191 1,200 1,044 1,096 1,104

8.91 8.75 9 14 9.18 8.71

7.55 7.75 7.88 7 83 8,00

6.84 6.80 6.90 6.95 7 04

8.85 8.70 8 76 --- 6.34 6.48 6.57 6.57 6.52

+ 41 + 53 +220 -143 +361

+ +

1.7 1.5 0.2 1.2 2.1

+ + +

0.1 0.9 0.3 0.9 5.2

+ 0 3 -+ 0 3 + 0.2 - 0.4

7 14 21 p 28 p

-

567 788 752 870

852 865 966 1,028

8 45 8 96 9 30 9.04

7.92 7.88 7 82 7 89

6.93 6.89 6.91 6.94

8.41 8.41 8.32 8.60

6.41 6.36 6.34 6.39

+ 40 - 60 + 3 -326

-

0 2 1.2 0.1 0.7

-

0.5 0 4 0.4 2.5

-

0.7 0.9 0.3 0.5

4 11 18 25

-1,078 - 922 - 888 - 918

1,258 1,071 1,111 1,064

9.21 9.18 9.39 8.41

7.77 7.36 6.83 6.84

6 92 6 72 6 57 6.61

8.63 8.40 8.32 8.20

6.28 6.26 6.24 6.00

-139 + 79 -148 - 13

-1.3 - 0.1 - 0.8 + 1.4

+ + -

0.1 0.5 1.1 0.3

+ + +

0.4 0.3 0 5 0 7

833

8.32

6.89

6.57

8 75

5.85

+ 59

+ 0.5

+ 0.3

1970--January p February p Weekly 1969--Sept.

Oct.

1970--Jan.

Feb.

Mar.

p p p p

4 p

-

-

694

"

Aver Year 1969 First Half 1969 Second Half 1969 Recent variation in growth 12/18/68-5/21/69 5/21/69-3/./70

1/ Average

8 22 7 46 8 96

6 67 6.15 7.19

6 32 6 12 6 513

7.62 7.20 n4

5.45 5.01 5.89

- 3.0 -3.7 - 2.4

690

955

935

1,163

6 97 8 82

6.10 7 13

6 07 6 55

7 09 8.03

4.83 5 78

- 5.2 -23

860 779 -939

-

-

+ 0.4

'' I

es

1,110 1,034 1,183

-

0.1 0.2 0 1 0.3

Annual rates of increase 4/ - 1.6 - 4.0 + 2.5 + 0.7 - 3.5 + 4.3 - 3.9 - 4.6 + 0 6

+ 0.6 - 3.9

- 2.3 - 4 9

+ 5.7 + 0.5

- 5 3 - 4.0 - 6.7

- 3.9 - 5 5

S A - Seasonally adjusted p - Preliminary ofdays in period of total number - issues carry a 10-year call protection. 2/ Includes Issues,jlr' Ing 5-year and 10-year call protection, banks all commercial 3/ Time deposits adjusted it d period or in case of weekly periods, the first week shown 4/ Base is change for month plel. din iplr'lri ** - Reflects $400 million reduction in member bank deposits resulting from withdrawal of a large country bank from System membership. Percentage annual rates are adjusted to eliminate this break in series. March 6, 1970

-2(2)

Over the same interval, the projected March increases in

these aggregates were strengthened, mainly for time deposits, partly in recognition of the change in policy that was voted.

The March projection

for the money supply, though raised somewhat in the month of February, did not become strong enough to achieve the previous bluebook money supply projection for the quarter.

Revised projections of the adjusted

credit proxy for the quarter, however, did strengthen relative to the previous bluebook. (3)

While the staff had expected some gradual improvement

in time deposit performance under the less restrictive alternative a opted by the Committee, the improvement developed more rapidly than projected partly because of an earlier and larger decline in bill rates than anticipated.

Much of the improved performance of time deposits was

attributable to consumer-type deposits at banks outside major money centers.

In addition, the attrition of domestic large negotiable CD's

came to a halt in early February, and inflows of foreign official funds into time deposits were larger than expected. (4)

After the last Committee meeting, bill rates declined

a further 45 to 60 basis points, bringing the total decline from year-end peaks to the neighborhood of 125 basis points.

The 3-month

bill was most recently quoted at 6.85 per cent, and the 1 year bill at 6.55

per cent

(which makes

long CD's competitive with this bill,

not with other money market instruments).

though

The decline in bill rates was

-3part of a general downward move in interest rates in both short- and long-term securities markets and appears to have reflected mainly

changing investor attitudes generated by weakening business indicators and expectations of an easing in monetary policy. (5) While Treasury bill rates dropped sharply in the first week after the last Committee meeting, the average effective rate on Federal funds remained in the 9--9-1/2 per cent range of the previous four weeks.

Subsequently, however, as bill rates started to bottom out,

the Federal funds rate dropped by about a percentage point and averaged between 8 and 8-1/2 per cent in the past two statement weeks, with a range of trading generally between 7-1/2 and 9 per cent in the week just past.

Dealer financing costs at New York banks have also declined

recently, with the average in the latest statement week dropping to just below 9 per cent.

Net borrowed reserves averaged $900 million in the

two statement weeks ended February 25, but they declined sharply to $694 million in the most recent statement week ending March 4. Similarly, member bank borrowings, which had averaged about $1.1 billion in February, dropped to $833 million in the statement week just past.

-4-

(6)

The following table summarizes the annual rates of

growth in major deposit, reserve, and credit aggregates for 1969, and, on a preliminary basis, for the first two months of 1970. Year

July -

1969

Sept. '69

Total Reserves

-1.6

- 9.3

1.4

Nonborrowed reserves

-3.0

- 4.8

-0.1

Money supply Time and savings deposits

Savings accounts at nonbank thrift institutions

Oct. -

Dec. '69

January - February

1970 - 5.3 - 5.3

--

1.2

- 0.6

-5.3

-13.3

--

- 6.2

3.3

2.1

1.2

1/ - 5.0-

-4.1

- 9.4

0.1

- 6.5

-1.7

- 6.2

-0.3

- 8.0

n.a.

- 4.0

-2.1

- 4.7

2.4

- 0.8

2.1

- 1.8

3.4

0.8

2.2

2.1

2.5

Member bank deposits and related sources of funds Total member bank deposits (bank credit proxy) Proxy plus Euro-dollars

Proxy plus Euro-dollars and other nondeposit sources

Commercial bank credit (month end) Total loans and investments of all commercial banks

L&I plus loans sold outright to affiliates and foreign branches

Dates are inclusive. All items are average of daily figures (with "other nondeposit sources" based on an average for the month of Wednesday data), except the commercial bank credit series which are based on total outstanding on last Wednesday of month. All additions to the total member bank deposit series and the last Wednesday total loans and investments series are seasonally unadjusted numbers, since data have not been available for a long enough time to make seasonal adjustments. I/ January data only. NOTE:

Prospective developments (7)

If the Committee wishes to continue on the growth path

of monetary aggregates (taken together),and associated money market conditions, that are implicit in the policy stance adopted at the last meeting, it may wish to consider the following second paragraph for the directive (alternative A): the To implement this policy, while taking account of [DEL: current Treasury refundin

possibblebank regulatory

changes

and] the Committee's desire to see moderate growth in money and bank credit over the months ahead, System open market operations until the next meeting of the Committee shall be conducted with a view to MAINTAINING THE SOMEWHAT LESS [DEL: moving gradually toward somewhat less] firm conditions THAT HAVE BEEN ATTAINED in the money market; provided, however, that operations shall be modified promptly to resist any tendency for money and bank credit to deviate significantly from a moderate growth pattern. (8)

Less restraint in the money markets developed gradually

over the past few weeks, and less firm money market conditions may now be taken to encompass a Federal Funds rate generally averaging in an 8--8-1/2 per cent range, net borrowed reserves generally in a $650-$850 million range, and member bank borrowings averaging $800-$900 million.

If money market conditions are held quite close

-6to those prevailing in the statement week just past, the 3-month bill rate might be expected to move downward within a 6-5/8--7 per cent range as the market's expectations of somewhat less restraint in money market conditions appear to be confirmed.

It is quite possible

that the bill rate could drop below the bottom of this range if market expectations of more easing develop, or if behavior of the monetary aggregates indicates to the Account Manager that he should shade money market conditions toward the lower end of the specifications (for example, having a Federal funds rate most frequently at 8 per cent or a little below). (9)

The Treasury will need to raise about $1-3/4 billion of

new cash by late March or early April, in addition to the already announced ongoing increments to regular weekly and monthly bill auctions. It appears likely that additional bills will be offered, possibly for payment in early April.

But there is some possibility the Treasury may

raise the cash in the coupon area (in which case the announcement would come within the next few days so as to obtain payment before the start of the quarterly grace period at thrift institutions).

A coupon issue for

cash could well attract speculative interest in the current market environment.

But the offering is small enough in any event so as to minimize

the need for "even keel". (10)

Any modest additional bill offering seems unlikely to

offset the expected downward tendency in bill rates.

Not only may

-7monetary policy and signs of economic weakness work toward lower bill rates, but there is also some tendency for bill rates to drop seasonally in early spring, reflecting retirement of tax bills (amounting to $1.8 billion in March and $4.8 billion in April).

As bill rates drift down,

it is likely that private short-term rates (such as on commercial paper, finance company paper, and bankers' acceptances) will move down further. In recent weeks declines in private short-term rates have lagged substantially behind the drop in bill rates and the marked widening in these rate spreads may not be sustainable, although continuing sales of bank-related paper could tend to moderate declines in short-term rates generally.

Long-term interest rates, too, may move down further,

reflecting business news and the expected easing in short-term markets, although offerings in corporate, municipal, and Federal agency markets are likely to remain large.

However, all these markets are susceptible

to some technical upward readjustment in yields, given the extent and rapidity of the recent rate declines. (11)

In view of the more favorable relationship between

Regulation Q ceilings and short-term market rates that is posited above, and taking account of the recent upward trend in time deposits, the staff expects a sizable rebound in time deposits during March and April.

In

March such deposits may rise in a 10-13 per cent annual rate, range, even assuming foreign time deposits grow a little more slowly on average than in February.

The growth rate might be somewhat larger in April,

-8as banks become more successful in attracting back large negotiable CD funds at declining short-term market interest rates, although it is most difficult to evaluate how aggressive banks will be in the CD market relative to the commercial paper and Euro-dollar markets. (12)

The money supply, which has varied sharply in recent

months, seems likely to expand in a 4-7 per cent annual rate range on average in March.

The money supply, while dropping sharply on average

from January to February, did grow over the past few weeks and in early March was above its February average.

Little net change from the

current level would be anticipated over the balance of March, on the assumption that transactions demands for cash will remain relatively weak,

However, in the last few days of March a temporary bulge is likely

to develop, reflecting in part a temporary reduction in cash items stemming from the changed pattern of foreign transactions that could be associated with the 4-day Easter holiday abroad.

In April, a slower

growth, on average, in the money supply is anticipated, unless economic activity should turn out to be stronger or interest rates significantly lower than projected. (13)

The adjusted bank credit proxy in March may grow in a

8-11 per cent annual rate range, due partly to a rise in Government deposits stemming from Treasury cash financing, but in April growth in the adjusted proxy is expected to drop to a 5-8 per cent range as the rise in private demand deposits diminishes and U.S. Government deposits

-9decline some.

These projections allow for continued growth in commercial

paper at about $100 million per week and assume no change in Euro-dollar takings from current levels. (14)

The table below summarizes expected first quarter annual

rates of increase for key monetary variables.

Second quarter projections

are also shown, assuming the money market conditions of paragraph (8), but with the expectation that short-term rates will be dropping further, partly for seasonal reasons, in late spring.

The projections also

assume that the sharp rise anticipated for time deposits will be partly offset by further repayment of Euro-dollars and/or declining bank interest in selling commercial paper, and that a sizable drop in seasonally adjusted U.S. Government deposits from the March average to the June average will provide a temporary fillip to the money supply.

It should be recognized, of course, that the projections are

subject to a considerable range of estimating error, and that they depend importantly on realization of staff projections of the level of economic activity as presented in the greenbook. First

Quarter

Second

Quarter

Money supply

2%

Time deposits

0

12

Adjusted bank credit proxy

1/2

5

Total reserves1/

-3

1/

3%

-1

Thereserve figures are affected by lagged reserve accounting in conjunction with the timing of sharp within-month deposit fluctuations. In addition they are affected by shifts in the deposit mix toward time deposits with relatively low reserve requirements and the general decline in Regulation M requirements associated with reduction in Euro-dollar borrowings.

-10Policy alternative If it is the Committee's desire to encourage somewhat

(15)

more growth in the monetary aggregates, and to move further toward less firm money market conditions, it may wish to consider the following second paragraph for the directive (alternative B): To implement this policy, while taking account of the [DEL: current Treasury

refundingpossible

bank regulatory

changes and] the Committee's desire to see moderate growth in money and bank credit over the months ahead, System open market operations until the next meeting of the Committee shall be conducted with a view to CONTINUING TO MOVE moving gradually toward somewhat less firm conditions in the money market; provided, however, that operations shall be modified promptly to resist any tendency for money and bank credit to deviate significantly from THE ANTICIPATED (16)

growth pattern. ] moderate a [DEL:

A continuing move toward less firm money market condi-

tions might entail a Federal funds rate averaging between 7 and 8 per cent, member bank borrowings dropping to around $700 million, and net borrowed reserves of $500-$700 million.

Under these conditions, the

3-month bill rate is likely to drop below 6-1/2 per cent over the next few weeks, and could move even lower as the spring progresses. (17)

The anticipated weakness of the economy through the

second quarter suggests that it will be difficult to generate much more growth in the money supply than indicated in alternative A without a

-11substantially lower level of interest rates.

At the same time, the

continuing tight position of banks generally suggests that there would

be a sharp expansion in bank credit if market interest rates dropped well below Regulation Q constraints, and banks thereby had the opportunity to regain their market position through time deposits.

As best we can

estimate the further easing in money market conditions specified in paragraph (16)

might be associated with a March growth rate of 12-15

per cent, annual rate, in total time deposits, and possibly with an even further rebound in the spring quarter.

The money supply might show

only a little more strength, with most of that later in the spring as lower interest rates make it marginally more attractive to rebuild cash balances.

Mainly because of the rise in time deposits, the adjusted

bank credit proxy would also be stronger than under alternative A, rising in an 8-11 per cent annual rate range in March and April together. It is assumed that the additional time deposits obtained by banks would substitute in part for funds now obtained through nondeposit sources. (18)

Staff guesses as to how the monetary aggregates might

develop under alternative B are shown in the table below (with figures representing percentage annual rates of change): First Quarter Money supply

2%

Second Quarter 4%

Time deposits

1/2

18

Adjusted bank credit proxy

1/2

7

Total reserves

-3

1

Table 1 MARGINAL RESERVE MEASURES (Dollar amounts in millions, based on period averages of daily figures) Member Period

Free reserves

Excess reserves

Total

Banks Borrowings C i t R e s e r v e Major banks O r 8 N.Y. Outside N.Y. ter

Country

Monthly (reserves weeks ending in): 1969--January February March April May June July August September October November December

477 580 635 - 844 -1,116 -1,078 -1,045 997 744 995 975 849

359 256 202 187 243 277 266 214 282 195 238 278

836 836 837 1,031 1,359 1,355 1,311 1,211 1,026 1,190 1,213 1,127

131 62 58 85 123 57 89 81 83 106 120 268

302 255 233 411 346 459 250 253 236 327 387 310

149 215 254 260 397 288 364 256 222 293 250 220

253 304 293 275 493 550 608 621 485 464 456 329

1970--January p February p

-

744 951

184 175

928 1,126

148 106

292 318

227 288

261 414

3 10 17 24

-

838 349 886 901

402 391 132 204

1,240 740 1,018 1,105

57 64 128 83

286 39 331 306

233 172 136 328

664 465 423 388

Oct.

1 8 15 22 29

-1,116 828 -1,129 857 -1,099

320 139 218 158 80

1,436 967 1,347 1,015 1,179

95 170 210 -53

531 112 396 275 322

257 267 302 344 293

553 418 439 396 511

Nov.

5 12 19 26

-1,032 - 873 925 -1,072

296 371 146 138

1,328 1,244 1,071

121 350 --

422 296 390

295 189 260

490 409 421

1,210

8

438

260

504

Dec.

3 10 17 24 31

-

988 903 946 832 576

203 297 98 264 528

1,191 1,200 1,044 1,096 1,104

266 293 164 296 319

307 264 296 356 334

241 264 301 150 153

379 379 296 292 299

7 14 21 p 28 p

-

567 788 752 870

285 77 214 158

852 865 966 1,028

196 234 75 86

327 281 340 218

87 188 297 339

243 162 254 385

4 11 18 25

-1,078 922 888 918

180 149 223 146

1,258 1,071 1,111 1,064

75 130 218 --

388 351 258 275

311 269 249 323

484 321 386 466

-

139

833

32

46

418

337

Weekly: 1969--Sept.

1970--Jan.

Feb.

Mar.

p p p p

4 p

p - Preliminary.

694

(In

Apggre g

Reserve Total Reserves

Period

Table 2 AGGREGATE RESERVESAND MONETARYVARIABLES Retrospective Changes, Seasonally Adjusted per cent, annual rates based on monthly averages of daily figures)

Nonborrowed Reserves

a t e s Required Reserves

Monetary Honey Member Bank Deposits

lotal

Sup

iPrivate Currency

V riab I 1 c s L unt rrcial p 1 y time bank time Demand' bak D posts deposits adjusted

Credit Prxy + lart. Eur l-dlars + Euro-d other noridep sources if tunds

Annually 1968 1969

+ 7.8 - 1.6

+ 6.0 - 3.0

+ 7.9 - 1.2

+ 9.0 - 4.0

+ 7.2 + 2.3

+ 7.4 + 5.8

+ 7,1 + 1.5

+11 5 - 5 3

Semi-annually 1st Half 1969 2nd Half 1969

+ 0.7 - 3.9

- 3.7 - 2.4

+ 1.0 - 3.3

- 3.5 - 4.6

+ 4.3 + 0.6

+ 6.5 + 4.9

+ 3.7 - 0.6

- 4.0 - 6.7

Quarterly Ist Quarter 2nd Quarter 3rd Quarter 4th Quarter

+ 7.9 + 1.5 +11 5 + 9.6

+ 1.1 + 2.1 +15.0 + 5.3

+ 7.5 + 1.8 +11.5 + 9.8

+ 7.3 + 1.4 +13.6 +12.7

+ + + +

5.5 8.7 6.8 7.1

+ + + +

6.9 7.8 7.6 6.6

+ + + +

+ 7.6 + 3.0 +16.5 +17.3

1st Quarter 1969 2nd Quarter 1969 3rd Quarter 1969 4th Quarter 1969

+ + +

0.1 1.2 9.3 1.4

-

2.8 4.7 4.8 0.1

+ + +

1.7 0.2 8.6 2.0

+

4.8 2.2 9.4 0.1

+ 4.1 + 4.5 -+ 1.2

+ + + +

6.5 6.3 3.6 6.2

+ 3.2 + 4,2 - 1.3 --

- 5.1 - 3.0 -13.3 --

n a. - 4.0 + 2.0

1st

-

2.9

- 2.0

-

2.3

- 0.7

+ 2.0

+ 7.0

+ 0.5

- 0.2

+ 0.3

Monthly 1968--April May June July August September October November December

- 6.9 + 2.5 + 8.8 + 7.6 +22.4 + 4,3 + 8.5 + 7.9 +12.1

- 6.9 + 0.9 +12.3 +13.8 +22.4 + 8,3 + 9.2 + 1,3 + 5.3

- 5.2 - 0.6 +11.3 + 9.4 +22.3 + 2.6 +10.4 + 8,4 +10.2

- 5.2 + 2.2 + 7.3 + 9.4 +22.2 + 8.8 +13.3 +11.5 +13.0

+ 5.9 +11.0 + 9.0 + 8.9 + 8.9 + 2.5 + 2.5 +11.3 + 7.4

+ 5.8 + 8.7 + 8.7 + 5.7 + 8.6 + 8.5 + 2.8 +11.2 + 5.6

+ 5.0 +12.3 + 8.3 + 9.8 + 8.9 + 1.6 + 2.4 +11.3 + 7.2

+ 3.2 + 3.2 + 2.6 +15.9 +17.0 +16.1 +18.3 +16.2 +16.6

1969--January February March April May June July August September October November December

+ 7.5 - 3.4 - 3.8 - 8.5 +19.9 - 7.6 -22.5 - 5.6 --11 7 + 9.7 + 6.3

+ 4.5 - 4.9 - 8., -12.0 + 6.0 - 8.2 -19.3 - 2.8 + 7.7 -17 9 + 5.5 +12.1

+12.7 - 3.0 - 4.4 - 5.0 +14.3 - 8.6 -17.6 - 7.6 - 0.8 -10.4 + 9.3 + 6.9

- 3.2 - 1.2 -n1.1 + 4.9 - 1.2 -10.2 -18.9 -11.3 + 1.7 - 9.2 + 9.7 --

+ + + + + + + -

6.2 3.1 3.1 7 9 1.2 4.2 1.8 1.8 -+ 0 6 + 1.2 + 1 8

+ 2.8 + 8.3 + 8.2 + 2.7 + 8.1 + 8.1 + 5.4 + 8.0 - 2.6 +10.6 + 7.9 --

+ 7.1 + 1.6 + 1.6 +10.2 - 1.6 + 3.1 + 1.6 - 4.7 - 0.8 - 0.8 - 1.6 + 2.3

-10.0 - 4,7 - 0.6 - 3.6 - 5.4 -18.5 -19 4 - 2.5 - 3.7 - 0.6 + 4.3

' - 7.0 - 7.5 + 1.6 - 7.9 +12.7 + 1.6

1970--January February p

+ 3.6 -14.3

+ 7.6 -18 0

+ 5 0 -13 1

- 3.8 - 9.3

+ 9.6 -10.1

+ 5.2 + 7.8

+10.9 -15.5

-12.4 - 0.6

- 3.1 - 6.3

1968 1968 1968 1968

Quarter 1970

p - Preliminary.

5.4 8.7 6.8 7.0

n.a. n.e.

-

n.a. 1.2

ony

upl

Table 3 AGGREGATE RESERVES AND MONETARY VARIABLES Seasonally Adjusted (Based on monthly averages of daily figures) Member Bank Deposits Supported by Required Reserves Private Total U.S. Gov't Time demand demand member bank de

Reserve Aggregates ./ Period

Total reserves

Nonborrowed reserves

Required reserves

do nnsv , t~ < --C~-----L

'

deposits

dennosits '--r---~-

In

(In mi lions of dollars)

Monthly:

1/ -~ '

b

I Total

denosits ~-~-~~~-

i o n s

Comnercial bank time Private deposits adjusted demand 4/ 3 ' deposits '

Mony Supply

-

o

d o

Currency 2/ a r

1968--January February March April May June July August September October November December

26,134 26,352 26,451 26,298 26,353 26,547 26.715 27,213 27,311 27,504 27,685 27,964

25,818 25,961 25,755 25,606 25,626 25,889 26,186 26,675 26,860 27,066 27,095 27,215

25,774 25,989 26,078 25,964 25,952 26,196 26,402 26,893 26,951 27,185 27,376 27,609

275.1 277.4 278.5 277.3 277.8 279.5 281.7 286.9 289.0 292.2 295.0 298.2

149.9 150.2 151.2 151.3 151.5 151.8 153.8 156.5 158.9 161.5 163.5 165.8

119.7 120.1 120.6 120.8 122.7 123.8 125.2 125.6 124.8 125.7 126.8 128.2

5.4 7.1 6.7 5.2 3.7 3.9 2.7 4.8 5.3 5.0 4.7 4.2

182.6 183.3 184.2 185.1 186.8 188.2 189.6 191.0 191.4 191.8 193.6 194.8

40.6 40.7 41.1 41.3 41.6 41.9 42.1 42.4 42.7 42.8 43.2 43.4

142.0 142.6 143.2 143.8 145.3 146.3 147.5 148.6 148.8 149.1 150.5 151.4

184.1 185.8 187.2 187,7 188.2 188.6 191.1 193.8 196.4 199.4 202.1 204.9

1969--January February March April

28,139 28,060 27,972 27,775 28,235 28,056 27,530 27,401 27,402 27, 354 27,783 27,928 28,012 27,679

27,318 27,206 27,024 26,754 26,888 26,705 26,275 26,214 26,383 76,210 26.538 26,806 26,976 26,571

27,902 27,832 27,729 27,614 27,942 27,742 27,334 27,161 27,144 27.129 27,548 27.707 27,823 27,519

297.0 296.7 294.2 295.4

163.2 161.0 160.5 160.1 159.3 158.1 155.1 152.5

128.4 129.1 128.9 129.4 130.0 130.5 130.5 129.9 129.2 128.9 129.1 129.4 130.1 128.6

5.4 6.7 4.8 5.9 5.9 4.0 2,4 2.9

195.8 196.3 196.8 198.1 198.3 199.0 199.3 199.0 199.0 199.1 19q9.3 199.6 201.2 199.5

4 .5 4".8 44.1 44.2 44.5 44.8 45.0 45.3 4).2 45.6 4').9 45.9 46.1 46.4

152.3 152.5 152.6 154.0 153.8 154.2 154.4 153.8 153.7 6 153, 13.4 153.7 155.1 153.1

203.2 202.4 202.3 202.3 201.7 200.8 197.7 194.5 194.1 193.5 193.4 194.1 192.1 192.0

May June July August September October November December 1970--Japuary p February p

I

I

I

295.1 292.6 288.0 285.3 285.7 283.5 285.8 285.8 284,9 282.7

I

152.1

151.5 151.1

151.5 149.4 148.8

I

4.4

3.1 5,6

4.9 5.3 5.3

-

I

_

_

_

_

_

_

_

Credit Prcxy + Euro-dollars + other nondep. sources of funds

307.5 305.7 303.8 304.2 302.2 305.5 305.7 304.9 303.3

_.

corporations and net interbank deposits. Private demand deposits include demand deposits of individuals, partnerships, and commercial banks. all of vaults the and Reserve, Federal the Treasury, the Includes currency outside domestic commercial banks and the U.S. Government, less cash items in Includes (1) demand deposits at all commercial banks, other than those due to and (2) foreign demand balances at Federal Reserve Banks. process of collection and Federal Reserve float; Excludes interbank and U.S. Government time deposits. Includes increases in required reserves due to changes in Regulations M and D of approximately $400 million since October 16, 1969.

Table 4 AGGREGATE RESERVES AND MONETARY VARIABLES Seasonally Adjusted

Reserve Aggregates Total

Period

reserves

Nonborrowed reserves

Required reserves

Member Bank Deposits Supported by Required Reserves Toal Private U.S. Gov't osits demand demand member bank deposits

Total

1/_ deposits

ddeposits

Credit Proxy + Euro-dollars + other nondep. sources of

Currency

Private demand

Commercial bank time deposits adjusted

2/

deposits 3

4/

a r 45,5 45.1 45.3 45.3

154.0 154.2 154.3 153.0

194.0 193.9 194.2 194.0

304.3 302.3 305.7 303.4

Money Supply

funds

3 10 17 24

(In millions of dollars) 27,409 26,194 26,957 27,325 26,687 27,059 27,370 26,364 27,238 27,236 26,199 26,982

285.8 283.7 287.1 285.0

151.9 151.9 152.0 152.2

(In b i 130.7 129.7 129.8 128.6

Oct.

1 8 15 22 29

27,717 27,233 27,260 27,547 27,238

26,362 26,291 25,975 26,520 25,989

27,417 27,044 27,059 27,263 27,041

284.2 283.7 281.9 284.1 283.4

152.3 151.9 151.4 151.3 151.2

128.1 128.8 127.8 129.7 129.1

3.8 3.0 2.7 3.1 3.2

198.3 199.6 198.7 199.9 198.5

45.2 45.4 45.6 45.7 45.7

153.1 154.3 153.0 154.3 152.8

194.3 193.9 193.6 193.3 193,4

302.4 301.9 300.7 303.2 302.1

Nov.

5 12 19 26

27,655 27,565 27,951 27,897

26,359 26,339 26,829 26,547

27,360 27,354 27,732 27,637

286.0 285.9 285.7 285.5

151.3 151.0 151.0 151.1

129.3 129.0 129.2 129.1

5.5 5.9 5.5 5.3

198.7 199.7 200.1 199,2

45.7 45.8 45.9 45.9

153.0 153.9 154.2 153.2

193,3 193.1 193.2 193.5

304,7 305.2 305.3 305.8

Dec.

3 10 17 24 31

27,839 28,041 28,020 27,790 27,898

26,588 26,641 26,861 26,718 27,099

27,646 27,619 27,946 27,576 27,713

287.2 285.7 285.5 284.3 286.2

151.3 151.4 151.7 151.8 151.3

129.8 128.7 128.5 127.6 131.3

6.1 3.5 5.2 5.0 3.7

199.3 198.4 198.7 197.8 203.0

45.9 46.0 46.1 46.2 45.8

153.3 152.4 152.7 151.6 157.2

193.8 193.8 194.1 194.3 193.9

307.3 305.9 305.4 304,5 306.1

7 14 21 p 28 p

28,115 28,009 28,072 27.883

27,148 27,137 27,056 26,730

27,791 27,939 27,918 27,685

286.2 285.0 284.9 284.1

150.6 149.7 149.2 148.6

131.6 130.6 130.3 128.8

4.0 4.7 5.3 6.7

202.5 202.1 201.7 199.2

45.7 46.0 46.1 46.3

156.8 156.1 155.5 152.9

193.2 192.3 192.0 191.5

305.4 305.2 305.4 304.5

4 11 18 25

p p p p

27,936 27,691 27,683 27,567

26,591 26,670 26,522 26,509

27,732 27,559 27,516 27,445

282.8 282.7 281.9 283.3

148.4 148.3 148.8 149.1

128.6 127.9 128.7 128.8

5.8 6.4 4.4 5.4

199.1 198.6 199.7 200.0

46.3 46.3 46.4 46.4

152.8 152.3 153.3 153.6

191.1 191.4 191.9 192.6

303.3 303.2 302.5 303.8

4 p

27,562

26,568

27,318

283.8

149.6

129.4

4.8

200.3

46.4

153.8

193.0

304.1

1969--Sept.

1970--Jan.

Feb.

Mar.

ion s 3.2 2.2 5.2 4.1

o d o 199.5 199.3 199.6 198.3

1/ Private demand deposits include demand deposits of individuals, partnerships, and corporations and net interbank deposits. 2/ Includes currency outside the Treasury, the Federal Reserve, and the vaults of all commercial banks. 3/ Includes (1) demand deposits at all commercial banks, other than those due to domestic commercial banks and the U.S. Government, less cash items in process of collection and Federal Reserve float; and (2) foreign demand balances at Federal Reserve Banks. 4/ Excludes interbank and U.S. Government time deposits. 5/ Includes increased in required reserves due to changes in Regulations M and D of approximately $400 million since October 16, 1969.