Bluebook

Prefatory Note

The attached document represents the most complete and accurate version available based on original copies culled from the files of the FOMC Secretariat at the Board of Governors of the Federal Reserve System. This electronic document was created through a comprehensive digitization process which included identifying the bestpreserved paper copies, scanning those copies, 1 and then making the scanned versions text-searchable. 2 Though a stringent quality assurance process was employed, some imperfections may remain. Please note that some material may have been redacted from this document if that material was received on a confidential basis. Redacted material is indicated by occasional gaps in the text or by gray boxes around non-text content. All redacted passages are exempt from disclosure under applicable provisions of the Freedom of Information Act.

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.

(CONFIDENTIAL

FR)

August 17,

1973

MONETARY AGGREGATES AND MONEY MARKET CONDITIONS Prepared for the Federal Open Market Committee

By the Staff BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

CONFIDENTIAL (FR)

August 17, 1973 MONETARY AGGREGATES AND MONEY MARKET CONDITIONS

Recent developments (1)

M 1 growth was at about a 6 per cent annual rate in July and,

with recent data pointing to a slowdown in August, it appears that for the July-August target period M 1 expansion will fall somewhat short of the range of tolerance set by the Committee.

Growth in M2 , on the other hand, appears

to be running above the upper end of its target range.

The unexpected strength

in M 2 reflects a strong consumer response in early August to the higher rates offered by banks on consumer-type deposits following liberalization of Regulation Q ceilings. Growth of Monetary Aggregates and RPD in June-July Target Period Ranges of Tolerance

Latest Estimates

Reserve and Monetary Aggregates (Growth at SAAR in per cent)

11-1/2--13-1/2

14

M1

3-3/4--5-3/4

3-1/2

M2

4-1/2-6-1/2

7-1/2

RPD

Statement week avg.

Memo:

Federal funds rate (Per cent per annum) As adopted and subsequently amended

9--11

8/8

10.39

8/15

10.39

(2)

Growth in

RPD over July-August also is

expected to be above

the upper limit of the Committee's range of tolerance, expected growth in

as greater than

CD's and nondeposit sources added to required reserves.

In addition, the implementation of the hike in required reserves in the week ended July 25 absorbed more reserves than we had allowed for because of a misestimation in (3)

In

the deposit mix.

the two statement weeks following the last FOMC meeting,

incoming data suggested that July-August growth rates in

all monetary

aggregates might approach and possibly exceed the upper end of their respective target ranges. tive posture in

Accordingly,

the Desk assumed a more restric-

the provision of reserves,

and the Federal funds rate

averages for both of these weeks slightly exceeded the 10-1/2 per cent upper limit of the constraint set by the Committee at its

July meeting.

Against this background a majority of Committee members agreed on August 3 to raise the ceiling for the Federal funds rate to 11 per cent in

order to provide room for maneuver if

further restraint on reserve

provision should prove necessary. (4)

Short-term interest rates rose sharply further during most

of the period since the July FOMC meeting in

response to high rates on

Federal funds and changed expectations as to the possible severity of monetary restraint.

Rates on large certificates of deposits and banker's

acceptances have paced this general advance,

as banks sought funds aggres-

sively in response to continued strong credit demands.

Advances in Treasury

-3bill rates lagged somewhat behind other short-term rate increases over most of July but then began catching up in early August, partly in response to the Treasury's auction of $2.0 billion of September 1973 tax bills and a sizable offering of short- and intermediate-term securities by the Federal Home Loan Banks. (5)

Given sharp upward market rate adjustments, the increase in

the discount rate to 7-1/2 per cent on August 13 had little term rates.

impact on short-

Market participants generally interpreted the increase as

representing an adjustment to a higher market rate structure rather than a signal of a further tightening in policy.

Indeed, a general credit market

rally began to develop around mid-August and short rates, particularly Treasury bill rates, declined from recent intermeeting highs.

Most recently

the 3-month Treasury bill was trading at around 8.70 per cent bid. (6)

Long-term market interest rates increased substantially after

the July Committee meeting, but late in the period there was a strong bond market rally.

With the combined new issue calendar for corporate and municipal

securities continuing on the light side, the further rise in long-term yields appeared to reflect mainly a reaction to the sharp rise in short-term rates. The strong rally in recent days appears to have been based on an attitudinal shift stemming from good international news and the thought that the monetary aggregates may be now under control.

Moreover, rumors of heavy buying of

Treasury coupon issues arising out of Middle East oil transactions further bulled the market, given the larger dealer short positions. (7)

The Treasury encountered great difficulty in its mid-August

refunding operation, which involved the auctioning of $4.5 billion in new

-4-

issues to redeem $4.7 billion publicly held issues maturing August 15, addition to the auction of September tax anticipation bills, the Treasury sold at auction $2 billion of a reopened, 7-3/4 per cent, 4-year note, and $500 million of a 7-1/2 per cent,

20-year bond.

Bidding for both coupon issues

was quite weak, and it was necessary for government accounts to support the market by buying outstanding securities and by acquiring about one-half of the bond issue in the auction.

Subsequently,

however, the market for both

of these coupon issues has improved markedly, and the bond and note are now about 5 and 2 points respectively above their auction prices. (8)

Mortgage rates also increased further during the inter-

meeting period, with an 8.71 per cent rate set in

the latest FNMA mortgage

auction--up 33 basis points since mid-July and 67 basis points since midJune.

In addition to moving in general sympathy with other long-term rates,

the continued rise in mortgage rates reflects an apparently sharp curtailment in the extension of commitments by thrift institutions--a cutback generated by net outflows of deposit funds in the latter part of July and early August. To meet these deposit outflows and cover the continuing takedowns of outstanding loan commitments,

savings and loan associations have been borrowing

heavily from their Federal Home Loan Banks in recent weeks, and the FHLB System in turn has raised a large volume of funds in the market for payment later this month.

Under the circumstances, both savings and loan and FHLB

System liquidity has declined, and mutual savings banks are reported to have been liquidating securities and drawing on outstanding lines of credit at commercial banks.

-5(9)

The table on the next page shows (in

percentage annual rates

of change) selected monetary and financial flows over various recent time periods. A new Appendix table III shows quarterly growth rates for money supply calculated in

two ways--by comparing average levels for all three months

of the quarter and by comparing levels in the final months of the quarter.

Past Calendar

12 Months

Past 6 Months

Past 3 Months

Dec. '72 over Dec. '69

July '73 over July '72

July '73 over Jan. '73

July '73 over April '73

Total reserves

8.4

9.6

5.8

10.4

26.2

Nonborrowed reserves

8.8

6.4

7.0

23.4

-44.1

Reserves available to support private nonbank deposits

9.0

11.5

10.5

14.7

7.5

6.8

7.1

9.8

M2 (M1 plus time deposits at commercial banks other than large CD's)

11.3

8.6

7.5

M3 (MN plus deposits at thrift institutions)

12.8

10.1

8.4

8.5

5.7

Total member bank deposits (bank credit proxy adj.)

10.7

12.8

14.0

11.0

9.4

Loans and investments of commercial banks2/

12.4

15.6

13.5

11.3

10.8

.9

2.2

3.4

1.9

2.5

0.1

-0.2

-10.3

0.3

0.5

Years

Past

Past Month

July '73 over June '73

7.6

Concepts of Money M 1 (currency plus

1/

demand deposits)-

.7

5.9

5.5

Bank Credit

Short-term market paper (Monthly ave. change in billions)

Large CD's Nonbank commercial paper

I/ Other than interbank and U.S. Government. Includes loans sold to affiliates and branches. Based on month-ead figures. 2/ NOTE: All items are based on averages of daily figures, except for data an total loans and investments of commercial banks, commercial paper, and thrift institutions--which are either end-of-nonth or last-Wednesday-of-month figures.

Prospective developments (10)

Three alternative policy strategies are summarized below

for Committee consideration.

More detailed figures, including estimates

into the future for M3 as well as the narrower money supply concepts, are shown in

the table on the following page. Alt. A

Alt. B

Alt. C

M1

4-3/4

3-3/4

2-3/4

M2

7-1/2

6-1/2

5-1/2

10-1/2

9-3/4

Targets (3rd & 4th qtrs. combined)

Credit proxy

9

Associated ranges for August-September 1973 13-1/2--15-1/2

RPD

M

2-1/2-- 4-1/2 8-1/2--10-1/2

M2 Federal funds rate range

9--10-1/2

13--15

12-1/2--14-1/2

2--4

1-1/2--3-1/2

7-3/4-- 9-3/4

7--9

9-1/2--11-1/2

10--12-1/2

(inter-meeting period) (11)

The three alternatives include the same M1 growth rates for

the second half of 1973 as in

the previous Blue Book.

Alternative B repre-

sents a continuation of the longer-run growth path for M1 reaffirmed at the last Committee meeting and depicted in

the chart following p.

7-a. The longer-term

growth rates for the other key monetary variables associated with each M1

-

7-a

-

Alternative Longer-Run Targets for Key Monetary Aggregates

1973

Alt. A

Alt. B

Alt. C

547.8 551.8 555.0

863.4 867.8 873.5

863.4 867.5 872.6

863.4 867.3 871.5

560.3

889.3

885.5

881.5

Alt. A

Alt. B

Alt. C

Alt. A

Alt. B

Alt.

July Aug. Sept.

264.5 264.8 266.1

264.5 264.7 265.8

264.5 264.6 264.5

547.8 552.2 556.4

547.8 552.0 555.8

bec.

269.4

268.1

266.8

565.9

563.2

C

Rates of Growth 1973 Quarters: 3rd. Q. 4th. Q.

4.4 5.0

4.0 3.5

3.5 2.0

8.1 6.8

7.7 5.3

6.6 7.2

6.1 5.9

5.6

Months: Aug. Sept.

1.4 5.9

0.9

0.5 4.1

9.6 9.1

9.2 8.3

6.1 7.9

5.7 7.1

5.4 5.8

Total Reserves , Alt. A Alt. B Alt. C

Alt. A

Alt. 8B

Alt. C

5.0

_ Adjusted gredit Proxy Alt. C Alt. B Alt. A 1973

4.6

Pl.

Sept.

437.9 444.8 449.7

437.9 444.7 449.3

437.9 444.6 449.1

33,550 33,938 34,515

33,550 33,937 34,484

33,550 33,936 34,454

31,299 31,991 32,480

31,299 31,990 32,450

31,299 31,989 32,420

ftec.

457.7

455.8

454.1

35,411

35,310

35,200

33,046

32,949

32,843

14.1 8.7

15.9 7.0

15.5 6.2

15.1 5.2

.0

10.5 18.3

10.5 17.3

10.5 16.2

July Aug.

Rates of Growth ruarters: 1973 3rd Q. 4th Q. ohths: Aug. Sept.

14.0 7.1

13.6 5.8

13.4 4.5

14.8 10.4

14.5 9.6

18.9 13.5

18.6 12.4

18.4 12.1

- 3.0 20.4

- 3.0 19.3

- --

--

-

18.3

MONEY SUPPLY AND LONGER RUN TARGET PATH

RATIO SCALE, BILLIONS OF DOLLARS

- 270 ^-

-

51'A% GROWTH

- 260

MI LEVEL FOR MARCH EXPECTED AT 3/19 FOMC--,..--,

250

S

II

II

II

II

N

O

1972

I

I

J

I

I

F

I

I

M

I

I

I

A

N

I

II J

J 1973

_

A

.

I

I

S

I 0

N

D

growth rate have been changed to reflect the behavior of time deposits following the early July changes in

Regulation Q ceiling rates.

In addition,

the funds rate ranges associated with the three alternatives have also been raised somewhat, reflecting in part the upward revisions in projected nominal GNP. (12)

The recent sharp rise in short-term interest rates will be

limiting money demand in the months ahead. in

nominal GNP is

As a result, even though growth

expected to remain substantial,

M 1 may expand at a rela-

tively slow pace between now and year-end, given prevailing money market conditions. range is ditions.

For alternative B, a 9-1/2--11-1/2 per cent Federal funds rate

shown.

This range is

symmetrical around current money market con-

Staff judgment and model forecasts suggest that the odds are better

than even that some decline in

the funds rate will develop if

the alternative

B targets for the aggregates are pursued, given the degree of restraint already built into the system. (13)

In the August-September period M1 growth under alternative B

is indicated to be in a 2--4 per cent annual rate range. growth rate is

shown for August,

A particularly low

reflecting in part drawdowns in

cash balances

for investment in higher yielding time deposits, especially the newly available, widely advertised long-term savings certificates. time stock adjustment is

likely to be short-lived in

its

However, such a oneeffects on cash

balances mainly held for transactions purposes or for normal financial market operations.

-9(14)

Under alternative B,

over the next two months, M 2 expansion

in a 7-3/4--9-3/4 per cent annual rate range is indicated.

The faster in-

crease in M2 relative to M1 results mainly from the initial sizable movement into consumer-type time and savings deposits at banks in regulatory changes.

The initial

inflow probably reflected not only some

movement out of demand deposits but, more importantly, nonbank thrift institutions.

the wake of the

shifts of funds from

We have assumed a gradual phasing out of

transfers from thrift institutions to banks, though we do not expect it

to

subside as promptly as transfers out of demand deposits because of the maturity distribution of thrift institution deposits and a certain inertia in

shifting deposits from one institution to another.

siderably more moderate rise in

On balance,

consumer type time deposits is

a con-

expected in

September than in August, and a further tapering appears in prospect for the fourth quarter. (15)

Growth of M3 in the August-September period--at around

5-1/2--7-1/2 per cent annual rate--is expected to be more moderate than in M2, since the shift in funds from thrift institutions to banks raise the M2 figures relative to M3 .

By the fourth quarter, we would expect most of

this divergence to disappear, and growth rates of consumer-type time and savings deposits at banks and thrift

institutions are both projected at

around 7 per cent. (16)

Looking to all

three money concepts,

by the fourth quarter M1

is indicated to be expanding at a 3-1/2 per cent annual rate under alternative B, while M2 and M3 growth is respectively.

expected to be around 5-1/2 and 6 per cent,

For M2 and M3,

since early 1970.

these would be lowest quarterly growth rates

-10-

(17)

The aggregates are specified

alternative C and more under alternative A.

to show less growth under Under alternative C, the

funds rate is expected to rise into the upper part of a 10 to 12-1/2 per cent range between now and mid-September.

The wider range specified

under this alternative reflects what we presume to be an icreasing difficulty in forcing the public to further economize on cash holdings at a time when interest rates have already increased to historically high levels. Under alternative A, we would expect the funds rate to drop between now and the next meeting, though perhaps not to the bottom of the indicated range. (18) sented are:

Other key assumptions in the monetary relationships pre-

(a) continued strength in business loan demand on banks;

(b) some reduction in demand for consumer and mortgage credit; (c) continued active demand by banks for large CD funds, though perhaps less aggressive demand than in the past four months taken as a whole; (d) greater bank reluctance to participate in the securities market, particularly under alternative C, in view of the wide spread of their borrowing costs over their return on portfolio.

On balance, bank credit--as

measured by the proxy--is expected to rise by around a 15--16 per cent annual rate in the August-September period, buoyed in part by a projected rise in U.S. Treasury deposits at commercial banks.

Growth is likely to be

considerably less rapid in the fourth quarter as credit demands fade somewhat, inflows of consumer-type time deposits abate, and Treasury deposits at banks decline.

-11(19)

Most short-term rates appear to have adjusted to a 10-1/2

per cent funds rate.

The 3-month Treasury bill rate was low relative to the

funds rate during the inter-meeting period, and the recent market rally has carried it even lower.

Some upward movement in the bill rate from recent

levels can be expected if money market conditions remain taut, in sympathy with continued strong demands in the short-term area by banks, business, and Federal agencies.

In addition, the bill market could be particularly affected

if foreign central banks sell bills in the market or liquidate Treasury specials in financing a return flow of funds to the U.S. (20)

Given the still wide spread of short- over long- rates, it

would appear that the recent market rally may have carried long rates lower than is sustainable.

However, market participants are now especially sensitive

to clues regarding System policy, and long-term rates could decline further if the market comes to believe that the aggregates are under control and monetary restraint has peaked.

With the market as sensitive as it is, a significant

move in the funds rate in either a tightening or easing direction is likely to be accompanied by prompt and rather sizable sympathetic adjustments in other interest rates.

-12-

Proposed directive (21)

Presented below are three alternative formulations for

the operational paragraph of the directive, which are intended to correspond to the similarly lettered policy alternatives discussed in the preceding section.

For all three alternatives it is proposed to delete the reference

to international developments in the dollar.

light of the recent strong recovery of

Retention of the reference to domestic financial developments

is proposed only for alternative C, the one alternative that contemplates a significant tightening of the money market. alternatives refer to growth rates in

As will be noted, all three

the aggregates "thus far this year."

For the period through July, these are as follows:

M1, 6 per cent; M2,

7-1/2 per cent; and the bank credit proxy, 13-1/2 per cent. Alternative A internationl of account taking while To implement this policy, [DEL: Treasury forthcoming the and developments market financial domesticate and financing,]

the Committee seeks to achieve bank reserve and money mar-

ket conditions consistent with SOMEWHAT slower growth in monetary aggregates over the months immediately ahead than HAS occurred on the] of half first the in average [DEL:

THUS FAR THIS year.

Alternative B international of account taking while To implement this policy, [DEL: and forthcoming the and developments market financial domesticate Treasury financing,]

the Committee seeks to achieve bank reserve

and money market conditions consistent with slower growth in monetary aggregates over the months immediately ahead than HAS the] of half first the in occurred on average [DEL:

THUS FAR THIS year.

Alternative C international] To implement this policy, while taking account of [DEL: forthcoming the and and domestic financial market developments [DEL: Treasuryfinancing,]

the Committee seeks to achieve bank reserve and

money market conditions consistent with SIGNIFICANTLY slower growth in monetary aggregates over the months immediately ahead than HAS the] of half first the in occurred on average [DEL:

THUS FAR THIS year.

STRICTLY CONFIDENTIAL (FR)

CHART 1

8/17/73

RESERVES AVAILABLE TO SUPPORT PRIVATE NONBANK DEPOSITS BILLIONS OF DOLLARS

-34

A

1r I

M

I J 1973

-i-8

ii

I I M

I

I

i

J 1972

i

I

S

I

I

D

I I J J

I

I I

M

J 1973

S

D

* Break in Series, Actual Level of RPD After Reauction in Reserve Requirements Effective November 9, 1972 * RPD Adjusted to Remove Discontinuity Introduced by increase in Reserve Requiremerns Effective July 19, 1973

I

L J

A

CHART 2

STRICTLY CONFIDENTIAL (FR)

8/17/73

MONETARY AGGREGATES NARROW MONEY SUPPLY M1

BILLIONS OF DOLLARS

-270

-250

I I I

II

I UI I

I

1 1I I

II J

.I-230

3ROADER MONEY SUPPLY M2

ly - Aug

41/% growth

i

972

1972

1973 1973

J 1973

A

S

CHART 3

STRICTLY CONFIDENTIAL (FR) 8/17/73

MONETARY AGGREGATES ADJUSTED CREDIT PROXY

BILLIONS OF DOLLARS

-470

-450

/

-430

-410

-390

I

I

I

I

i

70 J i

I1

I I I I I 1

TOTAL RESERVES

1972

1973

A

M

J

J A 1973

Break in series; Actual Level of Total Reserves After Reduction in Reserve Requirements Effective November 9, 1972

S

0

CHART 4

MONEY MARKET CONDITIONS AND INTEREST RATES MARKET CONIDITIONS

PER

CENT -11

WFEKLY AVERAGES

INTEREST RATES Short-term -

PER

CENT

INTEREST RATES

11

WEEKLY AVERAGES

WEEKLY

9 9

7

FHA MORTGAGES

FNMA MONDAY AUCTI

FEDERAL FUNDS RATE /

7

5

Aaa UTILITY NEW ISSUE

EURO-OOLLARS 3 MONTH

RATE

GOVERNMENT

-

S3

I

3

1972

1973

10 YEAR AVERAGE! F\

\AA

1972

1973

1972

/--\

1973

STRICTLY CONFIDENTIAL

1

TABLE

AUGUST 17,

BANK RESERVES (ACTUAL AND CURRENT PROJECTIONS) -- --

--- --

------ m----------- ------------------------------ ----II AGGREGATE RESERVES I REQUIREn NESERVES -------------------------------------I------------------RESERVES AVAILABLE FOR I PRIVATE NONBANK OEPOSITS II SEASONALLY ADJUSTED -----------------------------------------------------If-------------------I

- - -----

--------

-----------------------------

PERIOD -------------------

TOTAL

(I1)

I

(2)

ANNUAL RATES OF CHANGE --------------QUARTERLY: ------1973--1ST UTR. 2NO QTH.

29,860 30,095 30.511 31.299 (31.990)

I

1 1 I

10.5 12.0 (

29.893 29,931 30,174 31.117 (31701)

114.5) II

MONTHLY: 1973--APR. MAY JUNE

9.6 9.4 16.6

I

JULY

I

17.5

AUG.

1

10.51)

I

AUR.

I I

-------

I I I 1

AND

GOVIT

AND

DEP

INTERANK m----------

(5)

(6)

(7)

(a)

18.870 18,967 19.1?6 19.697

7777 7,842 7.898 79907 ( A.16)

P.970 3,119

2,465 2,350 1.949 2.251 ( 19947)

(20.001)

I

13

JO3.104 3J,59 30,554

I

31.111 30.383 31,94 31,53

I I I I

1

32.225 I 1

(

2.9 2.2

16.3)

I

I

I

26.1 1.1 24.0

I

i

26.2

44.1

1

(

-3.0)

5.3)

(

( -?0.51

1.239 3.44R ( 3.787)

90.2 85.4

7.7 9.9 (

10,9)

(

94,7)

- 9.5 6.2 10.1

10.9 10.0

135.3

8.6

46.2

14.5

1.4

60.2 77.4

-7.2)

1

16.51

(

118.0)

3.6)

(

9.0)

(

101.5)

I

It

I( 11.6)

I

11.41

I1 I II

I I

3

II

3P.4I5

31.612

I

18R961

7.47A

3. ?2

1.955

II

31.862

I

I

29.627 j3026 b 0.479

1R.986 19,261 19.187

7.890 7.90 7,917

3.244 3,17? 3.302

1,754 2.029 1,870

I

30.965

I I

30.147 31,044 31.458

19,324 19,294 199420 2141

7.896 7.H92 7.926 7.891

3,'56 3.338 3,477 3,524

2,388 2*195 2.509 P 257

1 I

I I I

31,654

319961

-7.1 17.3

12.3 4.4 0.6

1I I I 30.530

R 15

30.167 30,195 30.800 32.313 (32.237)

II I I I

14.1)

6

4 11 18 25

NON

I

(

3y.9V

32.42b 33.501 32578 33*803 33.790

32.126 .11647 32.806 32.294

329039

II It II II II 11 II II

29.755 309575 30.918

34,143

3?,558

?0,224

7.929

19917

11

33.536

319666

I

30,80

319378

20.039

7,942

3.67A

1,882

31.669

11

33901

329200

1

19,970

8,007

3r,73

1,940

SI JULY

CD'S

TIME DEP --------

I 329326 329445 32,460 33.550 (33.937)

8. 5.8

1

(

JULY-AUG.

I

II 1 1 II II II

III I I

15.5)

21

OTHER

I

II II

I I

I

(4) 1

(3)

I

20

PRIVATE

OEMAND I m---

I

I I I I I

JUNE

I

I

QTR,

WEEKLY LEVELS-SMILLIONb ------------------

RFSERVES

I

MONTHLY LFVELS-$MILLIONSI ----------------- I 1973--APR. 1 MAY I JUNE 1 JULY I AUG. I

3Rb

NONPORROWED

I NUN SEAS ADJ II RESENVES I SEAS AO.I -------- --------------------------I

-----

1973

1

-------------------------------------------

132.624

0--

I I

I I I I I

----------------------------------------------------------------

bATA SHOWN IN PAREtlT4FiSES ARI CUHRENT PROJELTIONS. ANNUAL RATtS OF bROWTH HAVE AFFN ADJUSTE6 FOR CHANGES IN RFSFRVF REQUIREMENTS EFFECTIVE JULY 19. 1973. OF 11-1/2 TO 13-1/2 1/ AT THE FOMC MEETING JULY 17. 1973 THE COMMITTEE AGRFEO ON A HPh RANG PER CENT.

NOTE:

STRICTLY CONFIDENTIAL

TAHLE 2

AUGUST 17,

MONETARY AGGREGATES (ACTUAL AND CURRENT PROJECTIONS, SEASONALLY

I I I

PERIOD

MONEY SUPPLY NARROW (M)

I I

RROAD (M2)

(1)

I

(2)

I

ADJUSTED

I I

CREDIT PROXY

(3)

MONTHLY LEVELS-SBILLIONSI *****----------

----

-m-1

1973--APR. MAY

I

JUNE JULY AUG. PERCENT -- ~-~----i--

ANNUAL

GROWTH i-----

258.2 260.5 263.2 264.5 (264.7)

536.2 540.6 545.3 547.8 (55".0)

I I

426.2 430.5 434.5 437.9 (444.7)

I

OUARTERLY ---------

I

1973--IST TR. 2ND OTR.

I I

10.3

5.7 9.5

15.0 12.2

3RD OTR.

I

( 4.0)

(7.7)I

(13.6)

I

7.5 10.7 12.4 5.9 ( 0.9)

I

8.1 9.8 9 4 10.4 5. 92)

13.1 12.1 11.1 9.4 (18.6)

( 3.4)

1

1.7

I

II

U.S.

I

ADJUSTED)

TIME AND SAVINGS DEPOSITS

It GOVT, II DEPOSITS

I I

TOTAl

iI It II II II II II II II II II II II II I1

(4)

I

(5)

5R 5.8 4.6

I I

5.1 1.4

I I

336.7 341.8 344.1 347.8 (354.0)

( 4 5)

I OTHFH I THAN CD S

1

I I

CD S

(6)

I

(7)

278.0 280.1 282.0 2M3.3 (P87*3)

I I 1 I

5 8,7 6 6 6 (6

1 NONDEPOSIT I SOURCES OF I FUNDS

I

S.1 5.4 5.a

6.5 ( 6.8)

I ?3.1 16.0

I

9.5

II

(16.2)

I

(11.2)

1

II II II If II II II II II

21.0

I

.7 8.7 9.1

1

MONTHLY

1973--APR. MAY

JUNE JULY AUG.

I

JULY-AUG. WEEKLY LEVELS-SBILLIONS JUNE

I

( 7.4)

(14.1)

I

6 13 20 27

263.2 263.3 263.9 26268 I

JULY

1

4 11 , 18 I 25 P 1

264.5 264.5 264.86 263.7

I I I I

544,8 545,2 545.8 544.8

433.5 433,4 435.4 435.1

547.4 546.8 548.0 547.2

438.3 436.7 437.0 437.7

1 I I

I

AUG.

--rl---

1 P I 8 P 15 PEI I

----------

548.5 549.4 551.5

263.8 263.6 264.5 I

-----------

I

439.4 441.6 444.7

I 1 If II II II II It II 11 11 II II

18.2 8.1 12.9 (21.4)

1 I

8.1 I

5.5 (16.9) (11.3)

(17.3) I

4.7 4.5 6.1 5.6

342.9 343.8 343.5 344.7

I I I I

281.6 281.9 281.9 282.0

346.1 346.3 347.6 348.8

I I I I

283.0 282.4 283.2 283.4

350.2 351.7 353.6

I I

284.7 285.8 287.0

I

6 1.3 6 1*9 6 1.6 6 2.6

5.5 5.5 5.7 5.7

6 3.1 6 3.9 6 4,4 6 5.4

5.9 6.3 6.5 6.8

I 5.4 3.1 2.5 3.3

1

4.4 4.5

----------------

NOTEI DATA SHOWN IN PARENTHESES ARE CURRENT PROJECTIONS.

--- 1

I 1

6 5.5 6 5.9 6 6.A

I I

6.A 6.5

I

7.2

1

-m---------------P

-

PRELIMINARY

PE - PARTIALLY tSTIMATE6

1973

STRICTLY CONFIDENTIAL

(FR)

AUGUST 17, 1973

Table 3 RESERVE EFFECTS OF OPEN MARKET OPERATIONS AND OTHER RESERVE FACTORS (Millions of dollars, not seasonally adjusted)

Period

Bills & Accept. (1)

Open Market Operations 1/ Coupon Agency RP's3/ Total Issues Issues Net (2) (3) (4) (5)

Daily Average Reserve Effect 2/ Open Market A Member Other 4 Operations Bank Borrowing Factors (6) (7) (8)

A in reserve categories req. resa against available res. 5/ U.S.G. and interb. (6)+(7)+(8)-(9) (9) (10)

A Target available reserves 5/ (11)

Honthl 1973 -- Jan. Feb. Mar. Apr. May June July Aug. Sept.

1,336 659 1,109 1,332 -506 649 1,073

-196 -207 -228 27

--18 -14 -19 -21 209 168

862 -193 542 -414 -942 -1,148

2,197 644 1,636 1,106 -1,470 1,085 2,416

1,116 146 1,689 1,323 1,437 -1,450 2,090

117 428 265 -137 66 1 263

376 -1,794 -1,723 -884 -1.392 1,084 -850

278 -109 156 -74 45 -470 318

1,331 -1,111 75 376 66 105 1,185

1973 -- June 6 13 20 27

-1,107 -198 293 590

--- --19 -229

1,955 -3,195 3,377 -1,262

848 -3,412 3,670 -444

-140 -2,156 968 951

-737 36 236 -82

869 1,499 -493 -945

-77 -295 67 -292

69 -326 638 216

July 4 11 18 25

464 380 -432 21

228 27 --

---168

2,699 -5,499 3,629 -656

3,390 -5,093 3,193 -466

1,937 -793 250p -22p

554 -722 42p 358P

-1,387 694 878p -20 4 p

618 -3 273p 2 - 82p

486 -818 897p 414p

Aug.

788 -198 -515

--351*

----

952 4,165 -59

1,760 -4,363 -223

674p -1,019p . 931p*

14p -86p -92p

-4 6 7p 489p 1,378p

-3 60 p 45p 62p

581p -661p 293p

Weekly

1

s 15 22 29 i/ 2/

2/

/

I/

Represents change in System's portfolio from end-of-period to end-of-period; includes redemptions in regular bill auctions. Represents change in daily average level from preceding period. Includes matched sale-purchase transactions as well as RP's, Sum of changes in vault cash, currency in circulation, Treasury operations, F.R. float, gold and foreign accounts, and other FR accounts. Reserves to support private nonbank deposits. Target change for July and August reflects the target adopted at the July 17, 1973 FOMC meeting. Target change for previous months reflects the bluebook patterns that are consisteht with target ranges that were adopted during the month. *Includes special certificate (i.e., borrowing by Treasury from FR).

995 -1,140 -40 505 200 175 795 680

STRICTLY CONFIDENTIAL (FR)

AUGUST 17, 1973 Table 4 SECURITY DEALER POSITIONS AND BANK POSITIONS Millions of Dollars

U. S. Govt. Security Dealer Positions Coupon Issues Bills

Period

Other Security Dealer Positions__ber Municipals Corporate Bonds Bonds (3) (4)

Excess** Reserves (5)

Member Bank Reserves Positions s Bank Re Basic Reserve Deficit Borrowing at FRB** Total Seasonal 8 New York 38 Other (6) (7) (8) (9)

(1)

(2)

High Low

4,291 1,916

1,585 -93

235 0

383 40

796 -133

1,223 12

-5,635 -1,638

-5,720 -1,910

1973 -- High Low

3,718 897

1,125 -96

175 0

244 45

631 -86

2,402 688

-5,243 -1,831

-7,267 -4,839

1972 -- July Aug. Sept.

2,262 2,643 4,099

97 692 170

142 114 53

166 176 174

147 255 162

202 438 514

-2,945 -3,913 -3,835

-2,603 -2,801 -4,024

Oct. Nov. Dec.

2,887 3,096 3,510

207 1,039 953

105 84 58

132 191 291

247 314 219

574 606 1,049

-3,637 -4,561 -4,977

-4,044 -3,622 -4,958

1973 -- Jan. Feb. Mar.

3,407 2,132 2,490

720 562 -50

27 77 24

177 123 125

289 207 177

1,161 1,594 1,825

-4,550 -4,187 -4,273

-5,469 -5,436 -5,847

Apr. May June

2,457 1,894 2,281

106 421 562

12 66 33

60 151 120

255 161 234

1,688 1,843 1,851

3 30 75

-3,293 -3,019 -3,507

-6,577 -5,872 -6,443

July

1,425

265

24

139

250p

1,953p

131p

-2,488p

-6 ,096 p

2,608 2,686 2,234 1,709

462 551 641 622

0 100 1 30

57 130 111 183

401 2 181 224

1,664 1,700 1,930 1,848

64 67 73 93

-2,934 -4,181 -3,875 -2,932

-5,772 -6,829 -6,581 -6,541

631 -20 4 05p 16 p

2,402 1,680 1,722p 2,080p

111 117 117p 12 8p

-2,771 -2,860 -2,202 -2,374

-6,137 -7,267 -6,651 -5,176

4 76 p 2

2,094p 2 ,008p 1,916p

141p 158 p 148p

-2,262 -2,4 11p -2,706p

-4,725 -5,49 0p -6097p

1972 --

1973 -- June 6 13 20 27 July

4 11 18 25

2,013 1,382 1,472 *1,362

391 373 328 * 234

0 77 10 10

134 129 144 148

Aug.

I 8 15 22 29

*1,193 * 897 *2,060

* 58 *112 * -18

0 0 lop

86 53 60p

4p 259p

Government Security dealer trading positions are on a commitment basis. Trading positions, which exclude Treasury bills financed by repurchase agreements maturing in 16 days or more, are indicators of dealer holdings available for sale over the near-term. Other security dealer positions are debt issues still in syndicate, excluding trading positions. The basic reserve deficit is excess reserves less borrowing at Federal Reserve less net Federal funds purchases. Weekly data are daily averages for statement weeks, except for corporate and municipal issues in syndicate which are Friday figures. **Beginning with January 1973, monthly averages for excess reserves and borrowings are weighted averages of statement week figures. Notes:

*STRICTLY CONFIDENTIAL

CONFIDENTIAL (FR) AUGUST 17, 1973 Table

5

SELECTED INTEREST RATES Per cent Short-term

Treasury bills Period

Federal

funds

-year

90-day

1972 --

High

1973 --

(7)

Issue

offered (8)

d B (9)

maturity)

Yields (11)

(10)

5.38 3.13

5.50 3.50

7.60 6.99

7.46 7.12

5.54 4.96

6.58 5.87

7.72 7.54

10.58 5.61

8.89 5.15

8.43 5.42

10.25 5.63

10.38 5.38

10.50 5.50

8.52 7.29

8.30 7.26

5.59 5.00

7.55 6.42

8.71 7.69

4.55 4.80 4.87

3.98 4.02 4.66

4.90 4.90 5.44

4.83 4.75 5.07

4.63

Aug. Sept.

4.65 4.88

4.75 4.78 5.00

7.38 7.37 7.40

7.37 7.34 7.42

5.41 5.30 5.36

6.11 6.21 6.55

7.63 7.63 7.65

Oct. Nov. Dec.

5.04 5.06 5.33

4.74 4.78 5.07

5.39 5.20 5.28

5.21 5.18 5.40

5.00 5.00 5.19

5.19 5.13 5.38

7.38 7.09 7.15

7.38 7.18 7.18

5.19 5.02 5.05

6.48 6.28 6.36

7.72 7.71 7.68

Jan.

5.94 6.58 7.09

5.41 5.60 6.09

5.58 5.93 6.53

5.76 6.17 6.76

5.63 6 16 6.78

5.75 6.28 6.75

7.38 7.40 7.49

7.35 7.41 7.51

5.05 5.13 5.29

6.46 6.64 6.71

7.69 7.72 7.78

6.26 6.36 7.19

6.51 6.63 7.05

7.13 7.26 8.00

7.04 7.44 7.98

6.75 7.41 8.13

7.48 7.51 7.64

7.48

7.50 7.64

5.15 5.15 5.18

6.67 6.85 6.90

7.89 7.96

June

7.12 7.84 8.49

July

10.40

8.01

7.97

9.26

9.09

9.19

5.40

7.13

8.46

13 20 27

8.43 8.17 8.55 8.59

7.03 7.09 7.22 7.24

6.95 6.93 6.98 7.14

7.68 7.88 8.03 8.18

7.75 7.88 8.00 8.30

7.88 8.00 8.13 8.50

July 4 11 18 25

10.21 9.52 10.22 10.58

7.69 7.87 7.85 8.14

7.62 7.65 7.75 8.24

8.56 8.88 9.10 9.58

8.63 9.00 9.13 9.63

8.75 9.00 9.25 9.75

8.28 8.48 8.89

8.43 8.41 8.41

9.85 10.08 10.25

9.88 10.13 10.38

10.00 10.25 10.50

High

July

Apr.

June 6

Aug.

?rtef:

(6)

Auction

5.50 3.75

tay

-- -

(5)

FNMA

(10-yr. Constant

5.52 3.60

Feb. Mar.

1973 --

Paper (4)

Government

U.S. Municpaer

5.13 3.03

Low 1972 --

Recently

5.38 3.18

Low 1973 --

Long-term

Aaa Utility

CD's New issue-NYC

ommercal

(J)

(2)

_

90-119 day

1 8 15 22 29

10.57 10.39 10.39

I

,

_

1

r

_

I

7.63 7.59 7.66 7.73

7.59 7.60 7.69 7.72

5.13 5.13 5.19 5.25

6.92 6.86 6.89 6.93

7.92 7.92

7.80 7.85 7.94 8.12

5.34 5.40 5.37 5.48

7.02 7.05 7.09 7.24

8.28

5.59 5.58 5.47

7.48

8.03 8.31 8.52 8.30p

II

8 30 8.16p

I

~L

_

8.07

8.04

8 09 8.38 8.54

8.71

7.54 7.46p

.

L----

Weekly data for columns 1 to 4 are statement week averages of daily data. Columns 5 and 6 are one-day Wednesday quotes. For columns 7, 8 and 10 the weekly date is the mid-point of the calendar week over which data are averaged. Column 9 is a one-day quote for the Thursday following the end of the statement week. Column 11 gives FNMA auction data for the Monday preceding the end of the statement week. The FNMA auction yield is the yield in the bi-weekly auction for short-term forward commitments for Government underwritten mortgages.

Appendix Table

I

CONFIDENTIAL

(FR)

RESEVES AND MONETARY VARIABLES

August 17, 1973 --.-

i;

----

II

'

Tntal I

ernte -

I

Available to P Support Pvt. fleenite

nhrroed

I

(

I----

0

CI

I

------

monav

Stock Measure"

I

C.

IFI 1

I }-an -

2

5

i

3I

~---'-P-_l----i-~-~T~

flant redlt Measures Ad td Total Credit I Loans and Proxy Investments

6--

i'~'-l-l-L*---

--- ner

Til m TotlI Other than Tie I CD'

It I

-:;~^9)1i n^ -t-an-i

'7-1-

~~--~ ~--

Thrift nstituon Deposits I

I CD's

Nondapott Fuods

(A \ --

Idt.atod

U .S. Gov't. Demand

'T'n "

(Dollar Change in Billions)

(Per Cent Annual Rates of Groth) Anually' 1968 1969 1970 1971 1972

+5.3 -2.8 49.6 48.1 47.1

48

+9.6 46.3

+10.7 +3.4

+10.1 43.0

+10.4 +11.4

+2.6 +13.0 -8.4 -7.6 40.4

+8.3 +2.9 +8.0 +13.5

+11.0 +3.9 48 1 +11.3 416.6

+11.5 -4 8 +17 9 +18.2 415.5

+11.2 +1.6

413.0

+9.5 +0.4 48.2 +9.4 411.6

+16.7 +13.3

+6.4 +3.5 +7.7 +17.5 +16.8

+14.9 47.4

416.4 +9.8

+10.1 +8.4

+11.5 +10.6

+21 6 +13.4

+20.0 +12.1

+19.6 +14.0

-7.1 -0.4

-1.4 +1.1

+7.7 48.5

+10.8

+10,3

413,0 412.1

+11 4 +11 1

+12.8 +15.5

+15.4 +14.5

+13.7 +12.1

+17.3 415.0

-0.3 +0.6

+0..

46.0

+7.7

+9.1

+13.8

+14.3

+20.0

+9.2

+11.6

+1.2

-1.1

+4.1 41.9

+6.0 48.7

+8.9 410 5

+6.7

+9.8 +16.6

+8.0 +15.9

+14.2 +13.3

-0.4

+1.1

+10 6 13.6 +9.9 +10.,

49.2 46.1

+16.1 +10.8 +12.3 +11.6

+19.7 +14.3 +16.2 +13.2

-0.3

48.6

+12.7 48 5 +10.3 +10.2

0. , +0.5 -1.1 +1.4

+1.7 4-10.1

+9.5

+10.4 +15.1 +12.6 +7.9 48.3 +9.2 412.5 +9.3 4+8.7 410.1 +7.9 +12.2

1 -1.7 48.6 47.2 49.7

+7.8 +3.6 +6.0 46.6 +8 3

+9.3

42.6 +8.6 +11.4 +10.8

411.1

+2.9 *12.4 +14.4 *7.7 +10.1

-0.6 +0.5 +1.1 -0.3 +0.4

seat-Annually.

Half Ind Wall let

1971 1971

slt 1alf 1972 2nd alif 1972

+12.1 +2.0 +4.9

lst Ralf 1973 anurtrlv

43

3rd Qtr. 1971 4th Otr. 1971 l1t Qtr, 1972 2td Qtr. 1972 3rd Otr. 1972 4th Otr. 1972

+10 7

Int Otr. 1973 ?n. Otr. 1017

-7.1 417.3

+10.5

+26,7 -5.7 +11.0

+11.0

1972'

1973

-0,8 -4.8

Tan Feb. Mt. Mar. Apr. May June July Aug. Sept. Oct. omv.

7 +9.6 +8.0 +2 9 +0.7 -6 1 +15 5 +9.8 -10.9

+6.5 +13.6 +6.8 +3.9 +9.0 46.9 49.7 +12.9 43.2 +20.8 +7.7

431.3 -41.3 -10.5 +26.1 +1,1 424,0 4664.1

+22.8 -4.7 +13.4 49.6 +9 +16.6 +17.6

421

Jan. Feb.

War. Apr. May June July p

-

-'-L--

fLt.Iteorve

requlromentx October 1. 1970 p - Treltminary.

2

+6.0

+8.2

+1 0 +14.7 +11.5 48 0 +4.0

+6.4 +12.7 44.4 47.2

+7.5

+10.7 +12.4 45.9

49

8

+9.7 1T1.1

+11.0 +11.5 +9.8 +12.1

+15.7 +9.5 +13.9 +16.4

+15.6 +14.8 414.0 +14.6

49.6

+15 0 +12.2

+1.64 +9.8

+23.1 416.0

+13.2 +16.8 +14.2

+9.2 +7.2 +16.2

+14.2 +12.4 419.9 +5.4 420.0 +2.3 49.0 417.9 +14.4 +10.7 +21.2 +16.7 +15.4 +20.3 +18.7 +6.6 +19.0 +3.8 +10.

417.7 +16.2 411.6 412.8 418.2 412.9 413.6 415.9 +12.0

+14.9

410.7 +12.4 411.5 +4.6

410.7

412.2 415.6

+11.1

+6.6 +10.0 49.6 49.5 +11.9 +10.5 +13.6 .8.3 +16.4 +19.7 +13.1 +12.1 +11.1 +9.4

410.1 +13.9 +11.6 +11.2

+12 0 + 9.8 +12.4 +9.8 +6.4 913.33 +9.0 +5.9 44.7 +6.9 +8.1 48.4. +9.8 +9.1 +10.4 +10.4 +5.5 +5.7

411.5

414.2 417.1 +15.7 +21.6 430.9 +21.0 418.2 +8.1 412.9

+9.5 +8.7

+19.2 +15.4 +13.2 +7.8 413.0 +11.4 +12.3 414.0 +10.2 +12.9 +10.4 +11.2 412.9 +5.7 +9.6 48.7 +9.1 +8,1 +5.5

+0.4 +0.3

+13.6 +9.1

40.5 +0.7

-2.4

+23.3 +16.6 418.2 +13.4 +21.6 +16.9 416,7 +16.9

-0,1 0.3 +0.1 0.2 +0.2

+0.2

+16.3 +14.5 +12.3 412.5 419.5 +9.1 +11.7 +6.4 +9.3 +12.1 -0.5

+ .1 +0.3 +B.1 +0.1 -0.1

+0.2 +0.2 +0.4 +0,3 +0.2 +0,9

-I

'

on Iurodollar

nhrrmvings are Includd beginning October

16.

40.7 -1.3 I +I +1.1 +0.7 -1.3 -0.7 +0.6 +1.2 +0.6 -0.4 ,0.6 4+.1 40.3

-1.7 -1.2 +0.S -1.7

-. _.r1969,

and requirements on bani-Telated conalirctal paper are included beginning

Appendix

Table II

RESERVES AND MONETARY VARIABLES of dollars) (Seasonally adjusted, billions '

c

----

RESERVES

MONEYSTOCKMEASURES Avellbla to

Period

Total

borrod

Depait

l (4)

Annully: ODe. 1969 Dec. 1970 Dee. 1971

~

BANKCREDIT MAlSURES Adjusted

lrota

Pvt. (5)

August 17, 1973

p (6)

3 (7)

Pco

Time

TotalI

l

v

ata

--- '

OTHER

Tia (10)

Ca'n (11)

194.6 229.2 270.9

Thrift Dea

tta

D's

(12)

(13)

183.5 203.9 237,9

201.7 216.1 253.8

10.9 25.3 33.0

Non-

U.S.

epe, (14)

and (15)

27,959 29.121 31.209

26,699 28,727 31,060

25,339 26,975 28,907

20s8. 221.3 236.0

162.7 172.2 183.4

392.3 425.2 473.8

594.0 641.3 727.7

307.7 332.9 366.3

606.0 638.9 688.6

Mar.

31,776 31,639 32,021

31,751 31,601 31,891

29,172 29,329 29,656

236.2 239.1 261.4

183.3 185.8 187.7

677.9 483.9 488.9

735.7 766.0 754.,8

367.1 369.3 376,3

696.6 699.5 507.8

261.7 244.8 247.5

257.8 262.1 265.9

33.2 33.7 33.8

6.0 3.6 3.7

6.3 4.6 5.7

Apr. Nay June

37,612 32.852 33,027

32,667 32,720 32,938

29,824 29,920 30,146

243.0 263.8 265.1

189.1 189.6 190.7

692.1 695.5 699.3

761.5 767.9 775.0

378.1 383.0 385.1

510.1 518.6 519.8

269.1 251.8 256.2

269.4 272.4 275.7

35.2 36.8 37.5

3.5 3.7 3.8

6.8 7.5 6.2

July AuB.

33.171 33,381 33.327

33,018 33,08

267.7 268.6 250.1

193.1 193.8 196.8

506.5 508.6 512.1

784.0 791.6 799.0

388.3 391.6 396.5

523.7 521.5 537.9

256.8 259.8 262.0

279.6 283.2 286.9

38.3 39.1 39.8

3.9 4.2

32.870

30,317 30,562 30.890

5.2 4.5 5.1

Oct. 1car.

33,832 31,883 31.309

33,295 31,297 30,063

30,973 29,496 28,862

251.6 252.7 255.5

195.9 196.5 198.7

516.6 519.8 525.1

807.0 813.6 822.0

398.4 601.9 606.4

542.7 552.3 560.0

264.8 267.1 269.6

290.6 293.8 296.9

60.0 41.2 63.2

6.3 6.3

&.4

6.3 6.9 6.5

1973--JeS. Teb. War.

32.242 31,669 31,999

30,868 29,787 29,526

29,411 29,296 29,622

255.4 256.7 256.6

198.6 199.3 198.7

527.9 530.5 532.6

828.7 834.9 839.7

609.2 616.8 421.6

567.2 576.8 585.8

272.5 273.8 276.0

300.8 306.6 307.0

66.4 48.8 56.9

6.5 6.5 4.9

7.1 7.2 7.5

Apr.

32,326 32,445 32,460 33,550

30,167 30,195 30,800 32,313

29,860 30,095 30,511 31,299

258.2 260.5 263.2 266.5

199.5 201.6 203.9 205.1

536.2 540.6 545.3 567.8

845.6 852.0 859.4 863.5

426.2 630.5 434.5 437.9

588.9 598.2 600.1 605.5

278.0 280.1 282.0 283.3

309.6 311.6 314.1 315.6

58.7 61.7 62.0 64.5

5.1 5.6 5.6 6.5

5.8 4.6 5.1 3.4

30,579 29,319 29,219 30,863

30,128 29,366 29,831 30,045

257.5 257.5 258.9 257.0

199.3 198.9 200.2 198.2

534.1 534.1 537.9 535.6

426.0 424.1 625.8 426.7

iiiiiii

189 25

32,628 31,838 32,519 32,402

2 9 16 23 30

32,387 32,116 32,940 32.384 32,353

30,627 29,620 29,490 29,971 30.570

30,120 29,620 30,360 30,037 30,293

259.4 259.5 261.2 260.6 260.8

200.8 200.2 202.3 201.6 201.8

538.6 538.3 541.2 541.2 541.8

6 13 20 27

32.685 31.862 32,624 32,425

31.012 29,753 30,575 30,918

30,530 30,108 30,596 30,556

263.2 263. 263.9 262.1

203.9 203.0 204.5 203.5 203,5

566.8 545.2 545.8 544.8

A

32,126 31,667 32,806 32,294

31,113 30,383 31,291 31,533

26,5

263.7

205.0 205.0 203.6 206.3

547.4 566.8 568. 0 567.2

32.558 31.666

32,225 31,654

263.8 263.6

206.5 203.7

548.5 549.6

5.3 6.5 6.1

Monthly: 1972--Jan.

sept. Dec.

Way June Jhly p

&

1973--Apr.

May

June

July

Aul.

11 18 25

p

33,501 32,570 33,803 33,790

1 8

p p

34.143 33,536

I

-

;,

::::::::::::::: ;:::::::::::::::

429.5 428,4 630.2 430.8 431.0

4

33 .3 335.6 337.1 337,4

276.6 276.6 279.0 278.6

57,7 59,0 58.1 58.8

4.9 6,9 5.2 5.6

7.7 5.4 4.6

361.7 342.9 iiiiiiiiiiiii 343.6

279.0 278.8 279.9 280,7 281.0

59.3 61.1 61.8 62.3 62.6

5,2 5.0 5.4 5.7 5.7

6.8 5.4 4.1 3.8 3.9

281.6 281.9 281.9 282.0 283.0

61.3 61.9 61.6 62.6

5.5 5.5 5.7 5.7

4.7 4.5 6.1 5.6

i

362.9

633.5 433.6 435,4 635.1

::::;:::: :

i;

::::::::::::::: ;

438.3 436.7 437.0 JI:::llllHI ............ !! 637.7

.5 34: 363.5 344.7

282.4 283.2 283.4

63.1 63.9 66.* 65.5

5.9 6.3 6.5 6.8

5.4 1.1 2.3 3.3

iiiiiiiil!350.2

284.7 285.8

65.9 63.9

6.8 6.5

3.5 4.4

............ i~

-- 1:""""""""

-----

351.7 U

4.O

!!.!!.. 346.3 347.6 iiiiiiiiiii iiiiii 346.2 i.!!

639.4 41.6

4.1

............... ;

p - Preliminary NOTr. IResrve reqniremento on Euro-dollar borrowings are included beginning October 16, 1969, and requirements on bank-related commnnercial paper are eluded beginning October 1, 1970. Adjusted credit proxy include mainly total member bank deposite subject to reserve requirements, bank-related comnsrcial paper, and Euro-dollar Fonthly data are daily averages except for non-bank coaeretal paper figurea which borrowings of F.S. hanks. eekly data ere daily averages for statement weeks. are for last day of month. Weekly date are not Available for M , total lBans and invetmnts and thrift institution deposlts.

APPENDIX TABLE

III

Growth Rate in Money Supply (Per cent change at an annual rate)

H2

M1

M 1971

1972

M

Q

M

Q

I

8.9

6.3

17.1

13.7

18.0

14.8

II

11.1

11.2

12.1

14.8

44.1

16.3

III

4.1

7.1

6.0

8.2

8.9

10.6

IV

1.9

2.2

8.7

7.4

10.4

9.6

I

9.2

5.3

12.7

11.1

14.9

13.2

6.1

8.4

8.5

10.0

10.7

12.1

III

8.2

8.0

10. 3

10.3

12.3

12.2

IV

8.6

7.1

10.2

9.5

11.4

11.4

1.7

4.7

5.7

8.8

10.0

6.9

9.5

9.2

II

1973

Q

"3

I II

10.3

M = Annual rates of growth calculated from average levels in the final months of the quarters.

Q = Annual rates calculated from average levels in all three months of the quarters.

8.5