bluebooks · May 17, 1976

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.

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).

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.

Strictly Confidential (FR)

Class I FOMC

May 14, 1976

MONETARY AGGREGATES AND MONEY MARKET CONDITIONS

Prepared for the Federal Open Market Committee By the staff

Board of Governors of the Federal Reserve System

STRICTLY CONFIDENTIAL (FR)

May 14,

1976

CLASS I - FOMC

MONETARY AGGREGATES AND MONEY MARKET CONDITIONS Recent Developments (1) M1 increased at a 15,7 per cent annual rate during April, as both currency and demand deposits rose sharply.

Even though M1

expansion appears to be moderating in May, growth for April and May combined is projected at around a 12¼ per cent annual rate, well above the 8½ per cent upper bound of the Committee's range.

Growth in M2 over

the April-May period is projected at about 12 per cent, at the upper end of the Committee's range.

Inflows to savings accounts at commercial banks

have remained strong, though continuing to decelerate from February's extraordinary pace; growth in time deposits other than CD's has strengthened somewhat. Growth in Monetary Aggregates over April-May period Reserve and monetary aggregates (Growth at SAAR, in per cent)

Ranges

Latest Estimates

4½ to 8½

12.3

8 to 12

12.1

Memo: Federal funds rate (per cent per annum)

4½ to 5½

Avg, for statement week ending 4.78 April 21 28 4.93 May 5 5.03 12 5.02

(2)

Following the April 20 FOMC meeting, the Desk promptly

became somewhat less accommodative in the provision of reserves and sought a funds rate around 4-7/8 per cent, a shade above the then prevailing rate of 4¾ per cent and equal to the mid-point of the range that had been adopted by the Committee.

Subsequently, with incoming data suggesting rates of

growth in M1 well above the Committee's desired range and M2 near the upper end of the range, the Desk adopted successively higher funds rate objectives, In moving to these higher rates the Desk took care in early May to avoid any undue disruption of the Treasury's refunding operation.

Most recently,

the Desk has been in process of establishing a 5¼ per cent Federal funds rate in the market, and as of this writing

funds were trading around

5-3/16--5¼ per cent. (3)

Growth in nonborrowed reserves in the April-May period,

though quite modest, has been somewhat more rapid than contemplated at the time of the previous FOMC meeting.

Such reserves increased at only a

1½per cent annual rate, on average, during April, as the sizable decline in CD's outstanding freed reserves to support the expansion of other deposits, but they show signs of increasing somewhat more rapidly in early May.1/

Member bank borrowings averaged about $40 million in the interval

between Committee meetings, little changed from the previous intermeeting period. (4)

Since the last Committee meeting, short-term market yields

have risen 35 to 50 basis points in response to the rising funds rate, to

A discussion of the expected and actual behavior of nonborrowed reserves relative to the Committee's short-run targets for monetary growth may be found in Appendix A.

indications of a significant pickup in growth in the key monetary aggregates, and to further signs of vigorous economic recovery.

Rates on most long-term

securities have moved up by roughly 25 to 40 basis points.

Rates in the

secondary mortgage market have increased along with yields in other sectors of the credit markets; however, primary mortgage rates have only halted their downward trend as deposit growth continued strong at nonbank thrift

institutions. (5)

The Treasury announced that its May refunding would include an

offering of three issues, with the following amounts available to the public:

$2 billion of 1-year, 11½-month notes and $750 million of reopened

23¾-year bonds on an auction basis, as well as about $3½ billion of 10-year notes on a fixed-price subscription basis.

The 10-year notes were sub-

stantially oversubscribed, and $4.7 billion of them were allotted.

As a

result, new cash raised in the refunding amounted to about $3½ billion. The issues have been readily absorbed by the market despite the recent rise in interest rates, and dealers have distributed nearly all of the $1.4 billion of securities they received in the operation.

Most recently,

the two notes traded about ¼-½ of a point below their average issue price, while the bond has been near issue price. (6)

Total short-term business credit remained unchanged during

April as a $1 billion rise in outstanding commercial paper issued by nonfinancial firms offset a similar decline in bank loans to businesses. Total loans at all commercial banks are estimated to have contracted slightly

during the month, but banks' net acquisitions of U.S. Government securities were substantial.

Weekly reporting banks allowed another $3½ billion of CD's

to run-off in April, as inflows from other deposits were strong. (7)

The table on the following page shows (in percentage annual

rates of change) related monetary and financial flows over various time periods.

The data in this table and all subsequent tables except Table 2

in the back of the blue book incorporate benchmark revisions for the money supply based on nonmember call reports for December 31, 1975.

These

revisions were relatively small in magnitude, and a comparison of the unrevised and revised data may be found in Appendix table VI.

---

Calendar Year 1975

Past Twelve Months Apr. '76 over

-Apr.

Past Six Months Apr. '76 over

'75 Oct. '75

Past Three Months Apr. '76 over

Past Month Apr. '76 over

Jan. '75 Mar ,'7

Nonborrowed reserves

1.3

-1.1

-0.4

-2.1

1.3

Total reserves

-.4

-1.3

-1.2

-2.5

0.9

Monetary Base

5.8

6.6

7.4

7.8

12.2

4.1

5.9

5.7

9.1

15.3

8.5

10.4

11.1

13.1

15.3

11.3

12.7

12.2

13.6

14.8

M4 (M2 plus CD's)

6.4

6.8

7.2

7.5

10.8

9.7

10.1

9.7

10.0

12.1

Total member bank deposits (bank credit proxy adj.)

3.9

3.3

3.7

2.6

3.3

Loans and investments of commercial banks 2/

4.3

4.8

5.0

7.1

4.9

-.6

-1.4

-1.6

-2.6

-1.8

Concepts of Money (Revised Series) Ml (currency plus demand deposits) 1/ M2 (M

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

M3 (12 plus deposits at thrift institutions)

(M3 plus CD's)

Bank Credit

Short-term Market Paper (Monthly average change in

billions) Large CDs

Nnbank commercial paer -. 2 -1 0.3 0,4 1.0 I/ Other than interbank and U.S. Government. 2/ Based on month-end figures. Includes loans sold to affiliates and branches. NOTE: All items are based on averages of daily figures, except for data on total loans and investments of commercial banks, commercial paper, and thrift institutions--which are derived from either end-of-month or last Wednesday-of-month figures. Growth rates for reserve measures in this and subsequent tables are adjusted to remove the effect of discontinuities from breaks in the series when reserve requirements are changed.

Prospective developments (8) Summarized below for the Committee's consideration are three alternative sets of short-run specifications for the monetary aggregates and the Federal funds rate.

(More detailed data, as well as longer-run

growth rates, are shown in the tables on pp.

and 6b, while reserve

aggregates consistent with the specifications are presented in appendix table V. Alt, A

Alt. B

Alt. C

Ranges for May-June M1

6-10

5¼-9¼

4½-8½

7½ -11½

7-11

5½-9½

4¾-5¾

5¼-6¼

Federal funds rate (intermeeting range) (9)

4¼ -5¼

Alternative B assumes a Federal funds rate range centered

on 5-1/4 per cent, the most recent Desk objective, while alternative A assumes some easing of the money market and alternative C some further tightening. Under all three alternatives, the rate of growth in M1 over the May-June period is expected to be considerably reduced from its April pace, though remaining stronger than in the latter part of 1975 and early 1976.

For instance, under alternative B growth may be in a 5-1/4 to 9-1/4

per cent annual rate range. (10)

The very rapid rate of expansion of M1 in April may have

been caused in part by a large decline in U.S. Treasury deposits.

However,

the underlying demand for money also appears strong, and a relatively

-6aAlternative Levels and Growth Rates for Key Monetary Aggregates M1

Alt.

Alt. C

1141.2

1141,2

1141.2

1152.3

1151.6

1150.6

700.8

1163.0

1161.2

1158.6

677.4 697.4 711.6 723.0

677.4 696.6 708.8 719.4

1116.1 1152.2 1178.5 1194.7

1116.1 1151.3 1177.7 1198.0

1116.1 1150.1 1172.7 1191.9

725.5

731.4

731.7

1200.5

1212.7

1213.8

7.2 5.9

10.1 9.1

9.5 8.3

8.3 6.7

11.7 11.1

10.9 10.0

9.9 8.3

9.7 6.3 3.5 3.0

9.4 5.0 3.3 4.8

12.0 8.4 5.3 2.1

11,8 8.1 6.4 4.6

11.3 7.0 6.0 6.8

12.9 9.1 5.5 1.9

12.6 9.2 6.9 4.9

12.2 7.9 6.5 7.3

8.4 2.9

8.1 3.2

7.3 4.0

10.3 3.7

10.1 5.6

9,3 6.5

11.2 3.7

11.0 5.9

10.1 7.0

5.7

7.1

8.0

7.6

8.7

8.8

Alt. A

Alt. B

Alt. C

Alt. A

Alt. B

Alt. C

April

301.8

692.1

May

304.0

303.8

303.6

697,9

697.6

696.9

June

305.9

305.5

305.1

703.2

702.4

1976

QI QII QIII QIV

296,5 303.9 309,0 311.9

296,5 303.7 308,5 311.2

296.5 303,5 307.3 309.8

677,4 697.7 712.3 721.8

1977

313.5

8.7 7.5

8.0 6.7

QII QIII QIV QI

10.0 6.7 3.8 2.1

Seami-annual QI '76-QIII '76 QIII '76-QI '77 Annual QI '76-QI '77

1976

Alt

growth Rates Nonthly: 1976

May June

Quarterly Average: 1976

1977

FOMC longer-run range QI '76-QI '77

44-7

74-10

9-12

-6bAlternative Levels and Growth Rates for Key Monetary Aggregates (cont'd)

Alt. A

Alt. B

Credit Proxy

M4 Alt

Alt. A

Alt. B

Alt. C

Alt. A

Alt. B

Alt. C

1976

April May June

763.4 765.8 770.5

763.4 765.5 769.9

763.4 765.1 769.1

1212.5 1220.2 1230.3

1212.5 1219.5 1228.7

1212.5 1218.9 1226.9

517.4 516.6 519.1

517.4 516.4 518.7

517.4 516.3 518.5

1976

QI QII QIII QIV

753.3 766.6 780.8 794.0

753.3 766,3 780.1 793.7

753.3 765.9 777.8 790.9

1192,0 1221.0 1247.0 1266.9

1192.0 1220.2 1246.3 1268.7

1192,0 1219.4 1241.8 1263.4

515.2 517.7 524.8 532.5

515.2 517.5 524.3 531.9

515.2 517.4 522.9 530.2

1977

804.8

806.4

805,7

1279.7

1287.7

1287.9

538.9

538.5

537.7

3.8 7.4

3.3 6.9

2.7 6.3

7.6 9.9

6.9 9.1

6.3 7.9

-1.9 5.8

-2.3 5.3

-2.6 5.1

QII QIII QIV QI

7.1 7.4 6.8 5.4

6.9 7.2 7.0 6.4

6.7 6.2 6.7 7.5

9.7 8.5 6.4 4,0

9.5 8.6 7.2 6.0

9.2 7.3 7.0 7.8

1.9 5.5 5.9 4.8

1.8 5.3 5.8 5.0

1.7 4.3 5.6 5.7

Semi-annual QI '76-QIII '76 QIII '76-QI '77

7.3 6.1

7.1 6.7

6.5 7.2

9.2 5.2

9.1 6.6

8.4 7.4

3.7 5.4

3.5 5.4

3.0 5.7

Annual QI '76-QI '77

6.8

7.0

7.4

8.0

4.6

4.5

4.4

Grath Rates Monthly: 1976

May June

Quarterly Averages: 1936

1977

rapid growth in M1 is likely to continue.

Perhaps indicative of the

strength of underlying money demand, there was no significant reversal

in late April and early May of the large build-up in private demand deposits in the first half of April. (11)

Growth in M2 over the May-June period is expected to

remain relatively rapid under alternatives A and B. Nevertheless, growth under alternative B--as measured by the mid-point of a 7-11 per cent, annual rate, range--is expected to be slower than during the first four months of the year.

This reflects the higher level of market interest

rates that has developed as well as some shift of funds out of savings and time deposits in payment for the $4.7 billion of new 10-year notes recently offered by the Treasury. (12)

Under alternative C, growth in M2 is expected to slow more

markedly over the May-June period. The further rise in the Federal funds rate that is envisaged would lead to a continued rise in other short-term rates, with the 3-month Treasury bill rate likely to move up to the 5-3/4-6 per cent area. This would probably lead to a considerable outflow from savings deposits of those interest-sensitive funds that were shifted into such accounts when short-term market rates first moved down to around 5 per cent, the Regulation Q ceiling rate on commercial banks' savings deposits. (13)

The firming of money market conditions associated with

alternative C would also exert upward pressure on longer-term interest rates over the next few weeks.

Loan demands are still focused more on

-8-

securities markets than on banks.

The corporate bond calendar has built

up further in recent weeks, partly in anticipation of higher interest rates later, and the municipal calendar remains sizable. Moreover, the Treasury is likely to continue raising much of its new cash in the coupon area. Even if the Federal funds rate stabilizes around 5-1/4 per cent between now and the next Committee meeting--as is contemplated under alternative B-some further upward adjustment in longer-term, as well as short-term interest rates may still occur, since markets probably have not yet fully adjusted to a 5-1/4 per cent funds rate. (14)

Over the coming year, the staff expects interest rates

generally to be under considerable upward pressure, assuming M1 growth from QI '76 to QI '77 is at a rate around the mid-point of the 4-1/2-7 per cent range adopted by the Committee.

Interest rates are projected to

reach higher levels than anticipated at the time of the last meeting for three main reasons:

(a) the FOMC lowered its longer-run growth rates for

M1 and M2 slightly; (b) the staff has revised upward somewhat its projection for the rate of growth in nominal GNP; and (c) the much faster than expected increase in the money stock apparently in store for the second quarter probably reflects, at least in part, an increase in money demand relative to GNP.

Because the annual rate of M1 growth in the second

quarter now seems likely to be in the area of 9½-10 per cent, annual rate, over the next three quarters the growth rate would have to be held to about 4-1/4 per cent (annual rate) if the 5-3/4 per cent growth of the QI '76-QI '77 range is to be achieved.

(15)

The staff's longer-run projections of the Federal funds

rate under each of the three alternatives are shown in appendix table IV.

As may be seen, the staff expects that under alternative B the funds rate would peak out at around 8-1/2 per cent early next year.

However, under

alternative C, which contemplates a prompt further move toward restraint, the funds rate may peak out at a lower 7-3/4 per cent level by the winter of this year.

A considerably higher ultimate level for the funds rate is

envisaged under alternative A, since it would be necessary to offset later the effects of near-term easing in reserve conditions contemplated by that alternative.

In view of these interest rate expectations, we have assumed

for all alternatives an increase in Regulation Q ceiling rates in the fall of this year of 50 basis points for certificates maturing in 4 years or more and 25 basis points for shorter-term certificates.

Even so, as

indicated in the last two lines of the table on p. 6a, over the QI '76-QI '77 period, growth in M1 at a rate equal to the mid-point of the FOMC's range is expected to be associated with growth in M2 and M3 at rates near the bottom of their respective ranges.

-10-

Proposed directive (16)

Given below is a proposed operational paragraph if the

Committee wishes to formulate its instructions in terms of desired growth in monetary aggregates over the months ahead.

No alternatives are pre-

sented for this formulation, in the expectation that the reference to desired growth will be taken to apply to the longer-term targets and that at this meeting the Committee will not reconsider those targets. 'Monetary Aggregates" Proposal To implement this policy, while taking account of developments in domestic and international financial markets, the Committee seeks to achieve bank reserve and money market conditions consistent with moderate growth in monetary aggregates over the period ahead. (17)

Should the Committee desire to place main emphasis on bank

reserve and money market conditions, the language needed would depend on the specific conditions sought.

Three alternative "money market" direc-

tives intended to correspond to the similarly lettered policy alternatives are given below. Alternative "Money Market" Proposals Alternative A To implement this policy, while taking account of developments in domestic and international financial markets, the Committee seeks to achieve SOMEWHAT EASIER bank reserve and money market conditions

moderate with consistent

monetary in growth aggregates over the

-11-

period IMMEDIATELY ahead, PROVIDED THAT MONETARY AGGREGATES APPEAR TO BE GROWING AT ABOUT THE RATES CURRENTLY EXPECTED. Alternative B To implement this policy, while taking account of developments in domestic and international financial markets, the Committee seeks to achieve MAINTAIN PREVAILING bank reserve and money market conditions

with consistent

in monetary growth moderate

aggregates

over the period IMMEDIATELY ahead, PROVIDED THAT MONETARY AGGREGATES APPEAR TO BE GROWING AT ABOUT THE RATES CURRENTLY EXPECTED, Alternative C To implement this policy, while taking account of developments in domestic and international financial markets, the Committee seeks to achieve SOMEWHAT FIRMER bank reserve and money market condimoderate with tions consistent

in growth

monetary aggregates over the

period IMMEDIATELY ahead, PROVIDED THAT MONETARY AGGREGATES APPEAR TO BE GROWING AT ABOUT THE RATES CURRENTLY EXPECTED.

CHART 1

CONFIDENTIAL (FR) CLASS II-FOMC 5/14/76

MONETARY AGGREGATES NARROW MONEY SUPPLY M1

BILLIONS OF DOLLARS

S-320 305

300

295

BROADER MONEY SUPPLY M2 290

1974

1975

1976

CHART 2

5/14/76

MONETARY AGGREGATES ADJUSTED CREDIT PROXY

BILLIONS

RESERVES

BILLIONS OF DOLLARS

TOTAL

NONBORROWED 33

1974

1975

1976

Total and nonborrowed reserve series have been adjusted to remove discontinuities associated with changes in reserve requirement ratios.

5/14/76

CHART 3

MONEY MARKET CONDITIONS AND INTEREST RATES MONEY MARKET COINDITIONS

PERCENT 8

F.R. DISCOUNT RATE

INTEREST RATES Short-term -

PERCENT

INTEREST RATES

WEEKLY

WEEKLY AVERAGES

- 7

9 FHA MORTGAGES FNMA MONDAY AUCTIO!

EURO-DOLLARS 3-MONTH -

FEDERAL FUNDS RATE

PRIME COMMERCIAL PAPER / 4-6 MONTH

S-

Aaa UTILIT NEW ISSUE

BILLIONS OF DOLLARS 1 2

1975

1976

1975

1976

1975

1976

CONFIDENTIAL (F.R.) CLASS II-FOMC

TABLE 1

MAY 14,

BANK RESERVES

1976

ACTUAL AND CURRENT PROJECTIONS, SEASONALLY ADJUSTED BANK RESERVES Period

Total Reserves

Nonborrowed Reserves

REQUIRED RESERVES Monetary Base

Total Required

Private Demand

111,537 112,191 113,335 (114,1141

33,833 33,780 33,862 (33,962)

19,715 19,659 19,783 420,0131

Total Time Deposits

Gov't. and Interbank

MONTHLY LEVELS-SMILLIONS 34,052 34,003 34,029 (34,162)

1976--FEB. MAR. APR. MAY

33,971 33,949 33,985 (34,081)

11,915 11,869 11,931 (11,758)

2,203 2,252 2,148 2,193)

PERCENT ANNUAL GROWTH QUARTERLY 1975--30 QTR. 4TH OTR. 1976--IST QTR.

-0.8 1.4 -6.2

-2.8 4.5 -5.3

4.1 7.3 4.5

-0.7 0.5 -5.7

3.4 -3.4 -2.0

-9.0 4.1 -11.1

0.1 0.6 -3.8

-1.9 2.7 -3.2

6.3 5.6 5.3

-0.1 -0.1 -3.6

6.2 -2.1 -1.0

-12.2 -0.6 -6.5

-6.1 -1.9 2.9 3.5)

-1.0

QUARTERLY-AV 1975--3R0 QTR. 4TH OTR. 1976--1ST QTR. MONTHLY -6.8 -1.7 0.9 S 4.7)

1976--FEB. MAR. APR. MAY APR.-MAY

WEEKLY

APR.

S 2.3)

(

10.3)

(

S 3.2)

-3.4 7.6 14.0)

(

-21.1 -4.6 6.3 -17.4)

10.8)

-5.6)

34,315

34,279

112,748

33,917

19,781

11,892

2,244

7 14 28

336,65 33,805 34,095 34,126

33,841 33,744 34,055 34,073

112,438 112,937 113,905 113,775

33,742 33,632 33,965 33,977

19,576 19,692 19,739 20,024

11,914 11,955 11,983 .11.910

2,253 1,985 2,243 2,042

5 12

34.815 33,662

34,785 33,606

114,334 113,258

34,329 33,725

20,140 19t922

11,792 11,779

2,397 2,024

21 MAY

2.8)

4.0 7.0 12.2 S 8.2)

LEVELS-$MILLIONS 1976--MAR.

NOTE:

(

-6.9 -0.8 1.3 3.4)

RESERVE SERIES HAVE BEEN ADJUSTED 10 REMOVE DISCONTINUITIES DATA SHOWN IN PARENTHESES ARE CURRENT PROJECTIONS.

ASSOCIATED

WITH CHANGES

I IN RESERVE REQUIREMENT RATIO.

Table 2

CONFIDENTIAL (FR) CLASS II-FOMC

MONETARY AGGREGATES ACTUAL AND CURRENT PROJECTIONS, SEASONALLY ADJUSTED Total

Broad

Credit

U.S. Govt.

(Ml)

(M2)

Proxy

Deposits1

Totall

Savings

Other

455.5 456.4 459.1 (458.61

380.1 383.2 387.8 (391.0)

170.2 173.5 176.6 1179.1)

210.0 209.8 211.1 (211.9)

Other Tan

Mmber

Nondeposit

Time and Savings Deposits

Adjusted

Narrow

Money Supply Period

CD'S

Funds

U.S. Govt.

Deposits

MONTHLY LEVELS-SBIL 1976--FEB. MAR. APR. MAY

296.9 298.4 302.3 (304.5)

677.0 681.7 690.1 (695.5)

515.6 516.0 517.4 (516.2)

10.9 11.0 7.2 7.1)

75.4 73.1 71.3 67.6)

8.0 8.2 7.5 7.5)

(

2.6 2.5 2.5 2.5)

X ANNUAL GROWTH QUARTERLY 1975-3R0 QTR. 4TH OTR. 1976-1ST OTR.

3.6 1.9 4.6

6.5 6.4 11.1

-0.8 7.0 1.2

2.6 11.8 4.6

8.9 10.1 16.2

14.5 17.1 32.1

4.9 4.7 4.0

-23.8 19.2 -47.3

7.1 2.5 3.0

10.1 6.1 9.5

1.4 6.0 2.3

4.7 9.1 6.8

12.7 9.1 14.8

18.4 14.7 28.6

8.6 4.9 4.4

-27.5 9.5 -29.3

(

6.5 6.1 15.7 8.7)

(

14.3 8.3 14.8 9.4)

3.5 0.9 3,3 -2,8)

6.9 2.4 7.1 -1.3)

(

20.6 9.8 14.4 9.9)

(

43.8 23.3 21.4 17.0)

(

2.9 -1.1 7.4 4.5)

(

-57.6 -36.6 -29.5 -62.3)

12.3)

(

12.1)

2.9)

(

12.2)

(

19.4)

(

6.01

(

-45.1)

QUARTERLY-AV 1975-3RD QTR. 4TH QTR. 1976-1ST QTR. MONTHLY 1976--FEB. MAR. APR. MAY. APR.-MAY

(

0.21

(

WEEKLY LEVELS-SBIL 1976-NAR.

298.6

683.2

515.3

9.0

457.8

384.5

73.3

8.2

1.9

APR.

7 14 21 28

300.0 30.3 303.7 302.3

686.6 691.1 691.0 691.2

517.3 517.9 519.6 515.2

7.3 5.6 9.6 6.2

459.9 459.8 458.0 458,5

386.6 387.8 387.2 388.8

73.2 72.0 70.8 69.7

7.2 7.2 8.0 7.6

2.4 2.5 3.6 1.9

303.1

692.4

515.8

6.8

458.4

389.3

69.1

7.3

1.7

MAY

NOTEt I/

3 P

DATA SHOWN IN PARENTHESES ARE CURRENT PROJECTIONS. INCLUDES TREASURY DEPOSITS AT MEMBER BANKS AND FEDERAL RESERVE BANKS.

CONFIDENTIAL (FR) CLASS II - FOMC

MAY 14, 1976 TABLE 3 RESERVE EFFECTS OF

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

BilU & Accept.

Period

)

Open Market Operations / Agency RPT'a Coupon aIssu Issues Net 3/ (2) (3) (4)

Total (5)

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

A In Reserve Categories Req. res. against Available res. 5/ U.S.G. and interb. (6)+(7)+(8)-(9) (9) (10)

1975--Oct. Nov. Dec.

147 -608 1,799

709 297

284 -1 --

15 -2,637 1,219

445 -2,537 3,315

1,276 521 1,165

-205 -130 66

-1,150 -387 -813

15 1 79

-94 3 339

1976--Jan. Feb. Mar,

-1,590 1,205 -180

321 528 203

240 295 --

3,597 -3,129 788

2,567 -1,101 812

942 1,631 128

-48 -3 -18

-308 -3,250 -96

137 -76 -22

449 -1,546 36

Apr.

464

294

1,261

2,019

-1,769

-14

1,888p

-116p

221

3 10 17

110 -711 401

-107 310

297 --- -3,314 -8,835 4,115

-2,907 -9,653 4,826

-93 -4,051 429

-63 -38 -7

588 3,380 -91

144 -50 -112

288 -659 443

24 31

376 -147

3,143 1,142

3,519 995

3,541 -1,002

38 -42

-3,727 1,718

-159 184

-70

-7,764

-4,396

-12

3,759

-64

5,064

4,543

-1,273

1,492

-225

364

5,206

6,372

4,845

-21

-4,139

310

-1,002

-13

138

1976-Mar.

Apr.

-1,608

-521

801

28 May

5 12

988 242 -634

-2,077 522

-9,442

-1,835 -12

2,600 -4,089

-23 26

-195p -1,677p 2,454p

11 490

-585 482

375

-297 444 -349

19 26

1/ Represents change in System's portfolio from end-of-period to end-of-period; includes redemptions in regular bill auctions.

2/ Represents change in daily average level for preceding period.

i/Includes

53p

456p -1,26Op

matched sale-purchase transactions as well as RP's. 4/ Sum of changes in vault cash, currency in circulation, Treasury operations, F.R. float, gold and foreign accounts, and other F.R. accounts. 5/ Reserves to support private nonbank deposits. P - Preliminary.

CONFIDENTIAL (FR) CLASS II - FOMC MAY 14, 1976 TABLE 4 NET CHANGES IN SYSTEM HOLDINGS OF SECURITIES 1/ ($ millions, not seasonally adjusted)

Treasury Bills Net Change 2/

Period

-490 7,232 1,280 -468

1972 1973 1974 1975

Within 1-year

Treasury Coupons Net Purchases 3/ Over 10 5 - 10 1 - 5

Total

Within 1-year

1,582 1,415 1,747 6,202

46 120 439 191

592 400 1,665 824

87 207 320 337

789 579 797 3,284

539 500 434 1,510

167 129 196 1,070

Federal Agencies Net Purchases 4/ Over 10

Total

253 244 659 460

168 101 318 138

1,059 864 3,082 1,613

285

5 - 10

1 - 5

Net Change Outright Holdings Total 5/

Net RP's 6/ -1,358 -46 -154 1,272

1,631 9,273 6,303 7,267

-2,093

1,054

625

312

2,024

169

584

508

Qtr. II

1,086

218

1,135

454

273

2,079

-2

3,076

230

Qtr. III Qtr. IV

-757 1,294

13 74

712 385

201 234

171 315

1,096 1,006

64 58

514 141

106 71

63 14

747 284

1,060 2,626

2,392 -1,403

-363

115

554

226

156

1,052

102

288

108

535

1,022

1,256

1975--Nov. Dec.

-588 1,784

43 31

267 118

156 78

244 71

709 297

99 2,096

-2,637 1,219

1976--Jan. Feb.

-1,596 1,275

37 40

110 366

100 63

73 59

321 528

26 76

139 149

47 61

27 11

-1,030 2,029

3,597 -3,129

Mar,

-42

203

788

Apr.

513

179

294

--63 --

24 --- --107 310 --

76 --

149 --- 61 --- 11 --

-70 --

1975--Qtr. I

1976--Qtr. I

1976-Mar. 3 10 17 24 31

150 -688 438 431 -156

-38 -

-107 185 --

Apr. 7 14

-1,593 -501

-70 -

800

249

364

1,008

5 12

240

-626

May

19 26 1/ / / 4/ 5/ 6/

240 297 --

1,261

-758

297 ----

407 -88 711 376 -147

-3,314 -8,835 4,115 3.143 1,142

-1,678 -521

1,166

5,206

988

-1,002

242

-2,077

-634

522

-7,764 5,064

Change from end-of-period to end-of-period. Outright transactions in market and with foreign accounts, and redemptions (-) in bill auctions. Excludes redemptions, Outright transactions in market and with foreign accounts and short-term notes acquired in exchange for maturing bills. maturity shifts, rollovers of maturing coupon issues, and direct Treasury borrowings from the System. Excludes redemptions and maturity shifts. Outright transactions in market and with foreign accounts only. In addition to net purchases of securities, also reflects changes in System holdings of bankers' acceptances, direct Treasury borrowings from the System, and redeptions (-) of Agency and Treasury coupon issues. Includes changes in both RP's (+) and matched sale-purchase transactions (-).

CONFIDENTIAL (FR) CLASS II - FOMC May 14, 1976

TABLE

SECURITY DEALER POSITIONS AND BANK POSITIONS (millions of dollars)

SU.S. Govt. Security Dealer Positions _

Underwriting Syndicate Positions Corporate Municipal Bonds Bonds (3) (4)

Period _

Bills (1)

Coupon Issues (2)

1975--High Low

7,029 1,586

2,845 253

464 0

389 48

1976--High Low

*6,821 *4,100

1,684 349

167 0

239 34

1975--Apr. May June

2,737 4,744 5,201

1,617 1,752 1,351

35 91 89

115 170 118

July Aug. Sept.

4,231 4,020 5,008

1,246 1,204 588

60 44 31

Oct. Nov. Dec.

5,766 4,751 4,822

1,480 2,073 1,075

4,959 5,214 5,910

May

NOTE:

Total

8 New York (8)

804 -42

74 5

-7,387 -1,757

-11,632

570 -106

11 8

-6,736 -2,367

-12,603

110 66 227

6 9 11

-4,079 -3,965 -5,821

-10,426 -

9,567 9,344

135 181 122

259 211 397

17 37 58

-5,546 -3,964 -3,551

9,896 9,966 9,015

14 156 95

123 173 103

189 60 130

65 29 14

-2,644 -3,812 -2,811

9,202

1,220 1,051 778

34 66 43

97 181 151

79 81 54

9 10 8

-3,581 -4,138 -4,726

*5,750

*605

133

43p

10p

-5,248p

-10,675p

3 10 17 24 31

4,530 5,984 6,107 6,106 .6,032

581 911 349 809 1,184

155 187 169 93 134

84 48 40 78 36

-4,415 -6,510 -4,980 -3,681 -4,226

7 14 21 28

6,725 6,821 *6,190 *4,100

669 773 *611 *405

158 97 139 136

24 61 39 53p

-5,819 -6,686 -5,016

-10,533 -12,660 -11,856

-3,533

9,215

5 12 1.9 26

*4,309 *4,620

*548 *949

137 2 00p

30p

-4,270p

7,145p

-6,198p

-9,23 p

Apr.

Excess** Reserves (5)

Member Bank Reserve Positions Borrowin& at FRB** Basic Reserve Deficit Seasonal (7)

1976--Jan. Feb. Mar.

1976--Mar.

5 p

38 Others (9) -

7,207

7,997

-10,159 -10,418 9,746

-10,015 -

9,640

9,390

-10,252 -

9,914

-10,095 -

8,824

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 for sale over the near-term. Other security dealer positions 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. *

STRICTLY CONFIDENTIAL

**Monthly averages for excess reserves and borrowings are weighted averages of statement week figures.

STRICTLY CONFIDENTIAL (FR) CLASS II -- FOMC

MAY 14, 1976 TABLE 6 SELECTED INTEREST RATES (Per Cent) Long-Term

Short-Term

Treasury Bills 1-year (3)

1975--High Low

90-Day (2) 6.68 5.02

90-119 Day Commercial Paper (4)

7.31 5.46

8.43 5.38

1976--High Low

5.17 4.73

5.92 5.35

5.44

1975--Apr. May June

5.61

6.40 5.91

6.11 5.70 5.67

5.34

July Aug.

6.13

6.64 7.16

6.32

6.05

6.59

7.20

6.79

6.31 6.44

5.96 5.48 5.44

6.48

6.35 5.78 5.88

6.08

6.07 6.16 5.44 5.53 5.82

5.15 5.13 5.25

4.91

Mar.

4.87 4.88 5.00

Apr.

4.86

5.54

5.08

Federal Funds

Period

5.23 5.34 6.44 6.42

Sept. I)Ct.

Nov. Dec.

1976--Jan. Feb.

1976--Mar.

Apr.

May

Daily--May

5.86

5.00

CD's New Issue-NYC 60-89 Day (5)

90-119 Day (6)

U.S. Govt. (20yr. Constant Maturity) (10)

FNMA Auction Yield (11)

GNMA Guaranteed Securities

7.75 5.38

9.71 9.06

7.67 6.27

8.63 7.63

9.95 8.78

5.13 4.75

5.38 4.88

8.94 8.44

7.13 6.54

8.15p 7.80

9.13

5.85 5.44

6.03 5.63 5.51

9.66 9.33

6.94 6.97 6.94

8.36 8.22 8.04

9.06 9.27 9.09

6.25 6.63 6.81

9.43 9.49 9.57

7.06 7.17 7.44

8.17 8.50 8.57

9.14 9.41 9.78

6.45 6.03 5.83

9.43 9.23

7.39 7.43 7.31

8.35 8.28 8.23

9.80 9.80 9.31

4.84

5.03 5.06

5.05

5.20

8.79 8.63 8.61

7.07 6.94 6.92

8.01 8.03 7.97

9,10 9.06 9.05

8.37 8.29 8.30

4.81

4.94

8.52

6.60

7.86

8.89

8.22

5.13

5.38

8.72 8.64 8.60 8.50 8.54

7.04

5.25 5.25

6.98 6.92 6.72 6.69

8.07 7.99 7.97 7.89 7.90

9.06

8.31 8.31

8.50

6.65 6.54 6.55 6.55 6.71

7.88

5.69 5.65

4.95 4.86 4.77

5.87 5.92 5.86

5.13 5.13

4.79

4.84

5.71 5.71

5.00 4.88

5.13 5.00

7 14 21 28

4.73 4.77 4.78 4.93

5.69 5.42 5.40 5.57

4.88 4.75

5.00

5 12 19 26

5.03 5.02

5.65 5.79

5.00

6 13

4.94 5.12p

5.69 5.91

Municipal Bond Buyer (9)

5.25

3 10 17 24 31

4.92 5.10

Aaa Utility New Recently Offered Issue (8)

4.75 4.88

5.13

9.65

9.26

8.72 8.63 8.61 8.53 8.60 -

4.88 4.88 5.00

8.42 8.38 8.58

8.44 8.54 8.57

5.13 5.25

8.68 8.82p

8.62 8.78p

6.83

8.83

8.31

9.03

8.31 8.28

7.84 7.80 7.84r 7.94

8.94

8.27 8.12 8.27 8.23

8.03 8.15p

8.94

8.83

8.31 8.31

8.02 8.17(5/12)

NOTE: Weekly data for columns 1 to 4 are statement week averages of daily data. Columns 5 and 6 are S1-day Wednesday quotes. For columns 7 and 10, the weekly date is the mid-point of the calendar week over which data are averaged. Columns 8 and 9 are 1-day quotes for Friday and Thursday, respectively, following the end of the statement week. Column 11 gives FNMA auction data for the Monday preceding the end of the statement week. Column 12 is a 1-day quote for the Monday preceding the end of the statement week. The FNMA auction yield is the average yield in bi-weekly auction for short-term forward commitments for Government underwritten mortgages. GNMA yields are average net yields to investors on mortgage-backed securities for immediate delivery, assuming prepayment in 12 years on pools of 30-year FHA/VA mortgages carrying the prevailing ceiling rate.

Appendix A Comparison of "Targeted" and Actual Reserves The table below compares the actual average level of reserves for the 4 week period ending May 19 with the "targeted" level that had been thought to be consistent with the mid-points of the short-run ranges for the monetary aggregates adopted at the last FOMC meeting. Actual 1/ Nonborrowed reserves Total reserves Monetary base

34,136 34,190 113,870

"Targeted"

Difference

33,886 33,964 113,234

Memorandum: Member bank borrowing Excess reserves 1/

250 226 636 -24 27

Includes week of May 19, which is partly projected. As can be seen, nonborrowed reserves during the intermeeting

period turned out to be $250 million higher than "targeted."

In evaluat-

ing the relationship between "targeted" and actual reserves during the period just past, it needs to be recognized that the FOMC adopted a Federal funds rate range--4-1/2 to 5-1/4 per cent--that was somewhat

lower than the range the staff had believed consistent with the chosen monetary and reserve aggregates--which was 4-3/4 to 5-3/4 per cent.

Thus,

the chances of hitting the nonborrowed "target" were reduced by the particular Federal funds rate constraint adopted. Given the actual Federal funds rate, about $50 million more in nonborrowed reserves had to be supplied to accomodate larger bank demands for free reserves (excess reserves minus borrowings) than the

A - 2 have had to rise sufficiently in the short run to limit expansion in

deposits and required reserves.

Upward rate pressures would have been

most pronounced in pursuing a monetary base target, given the need to reduce total reserves in order to offset the very rapid expansion in currency that took place.

Astaff had assumed.

In addition, reserve demands were considerably

strengthened as required reserves turned out to be $200 million higher than originally expected at the time of the last FOMC meeting. reflected stronger deposits than earlier anticipated.

This

However, the

multiplier relationship between lagged deposits and current required reserves turned out to be higher than anticipated, and therefore held down the increase in required reserves that would otherwise have been associated with deposit growth. If the Desk had restrained nonborrowed reserves further, banks would have been forced to borrow their required reserves and/or to reduce deposit expansion.

However, given the sgrength in deposit demand, and

assuming an orderly upward adjustment in the funds rate, the nonborrowed reserve "target" (within a $50 million range) probably would not have been achieved even if the upper limit of the funds rate constraint had been as high as 5-3/4 per cent. Actual total reserves differed from "target" by about the same magnitude as nonborrowed reserves.

The monetary base showed a much larger

overshoot, reflecting the considerably greater than anticipated rise in currency. In sum, if the Desk had adhered to a nonborrowed target, upward interest rate pressures would have been stronger over the intermeeting period.

Such pressures would have been even stronger if attempts had

been made to achieve the total reserve target, since interest rates would

APPENDIX TABLE 1-A

MONEY AND CREDIT AGGREGATE MEASURES

Period

Tol

Nonborrowed

Monetary Base

Total Loans and Invest-

Adj. Credit proxy

14,

1976

MONEY STOCK MEASURES

BANK CREDIT MEASURES

BANK RESERVES V

MAY

ments

5 6 7 4 (Per cent annual rates of growth)

ANNUALLY:

REVISED SERIES 8.8 7.2 8.5

6.7 7.1 -0.4

6.0 9.2 1.3

7.7 9.2 5.8

10.5 10.2 3.9

1974

4.2

19.3

8.0

6.1

3.1

3.9

1ST HALF 1975 2ND HALF 1975

-1.2 0.3

1.7 0.9

5.6 5.7

4.5 3.1

5.1 3.4

5.6

2ND QTR. 1975 3RD QTR. 1975 4TH OTR. 1975

1.3 -0.8 1.4

-0.1 -2.8 4.5

7.2 4.1 7.3

5.3 -0.8 7.0

4.6 3.6 3.1

9.7

1ST QTR. 1976 QUARTERLY-AV:

-6.2

-5.3

4.6

1.2

2ND OTR. 3RD QTR. 4TH QTR.

1975 1975 1975

-1.4 0.1 0.6

-0.4 -1.9 2.7

5.2 6.3 5.6

1ST QTR.

1976

-3.8

-3.2

1975--APR. MAY JUNE JULY AUG. SEPT. OCT. NOV. DEC.

3.5 -11.6 12.2 -3.2 -3.1 3.9 -6.3 9.7 0.8

1976--JAN. FEB. MAR. APR. P

-10.2 -6.8 -1.7 1.2

1973 1974 1975

8.8 6.8 11.3

11.6 10.6 6.4

10.6 9.0

11.9

9.7

9.e

6.1

6.2

7.8

7.4

7.0

9.8 6.8

11.9 10.1

6.9 5.7

9.9 9.2

9.4 9.4

1.6

12.5 6.5 7.0

14.5 10.7 9.3

7.7 3.0 8.4

11.3 8.1 10.0

10.1 7.5 11.2

7.3

4.3

11.5

12.6

5.0

8.4

8.0

3.6 1.4 6.0

5.1 4.1 4.7

7.4 7.1 2.3

10.2 10.1 6.4

12.6 13.3 9.4

5.6 5.7 6.7

9.4 10.1 9.4

8.7 9.5 9.7

5.3

2.3

4.0

2.6

10.1

11.4

5.8

8.6

3.4 -10.1 6.5 -5.8 0.0 -2.6 0.8 14.3 -1.6

4.5 3.6 13.3 4.7 4.9 2.8 3.6 11.1 7.0

2.2 1.0 12.7 -3.3 -4.3 5.2 5.9 14.4 0.7

3.4 5.1 5.1 2.0 6.6 2.0 6.0 10.5 -7.3

7.1

3.9 6.2 12.9 5.1 -0.5 4.3 7.9 11.7 5.3

8.3 10.1 15.0 10.0 5.9 8.2 9.9 12.1 7.7

7.8 8.6 13.5 10.6 6.0 5.7 10.5 14.7 8.0

-8.4 -6.9 -0.8 1.6

2.6 4.0 7.0 12.3

-0.7 3.5 0.9 3.3

'5.3 8.1 8.2 4.9

3.5 7.0 4.5 10.8

7.2 9.8 7.8 12.1

6.7 9.2 7.8 11.4

13.5 9.2 4.3

8.9

SEMI-ANNUALLY: 2ND HALF

2.6

QUARTERLY:

3.6

MONTHLY:

NOTESt 1/

11.4 14.2 3.7 5.3 1.6 -0.8 9.0 -3.2

13.4 16.5 9.5 5.7 4.2 5.3 11.5 4.0

10.8 14.9 17.4 13.2 10.3 8.5 8.7 11.9 7.1

1.2

10.7 14.9 8.7 15.3

11.9 14.7 10.8 14.8

3.4

5.7

6.1 15.3 u

ADJUSTED CREDIT PROXY INCLUDES MAINLY TOTAL MEMBER BANK DEPOSITS RELATED INSTITUTIONS, AND EURODOLLAR BORROWINGS OF U.S.BANKS. BASED ON DATA ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS.

-s

SUBJECT 70 RESERVE REQUIREMENTS, LOANS SOLD TO BANK-

APPENDIX TABLE 1-B

MONEY AND CREDIT AGGREGATE MEASURES

MAY 14,

SEASONALLY ADJUSTED, BILLIONS OF DOLLARS MONEY STOCK MEASURES

BANK CREDIT MEASURES

BANK RESERVES 1

1976

STotal

Period

Adj.

TNonborrowed 1

Loans

Monetary Base

Credit proxy

and Invest-

MI1

Sments

REVISED SERIES

ANNUALLY9 1973 1974 1975

32,390 34,693 34,539

31,092 33,966 34,409

96,051 1048,92 110,930

449.4 495.3 514.4

634.6 691.9 721.6

270.5 283.1 294.8

571.4 612.4 664.3

919.5 981.6 1092.9

634.9 702.2 747.2

982.9 1073.4 1175.8

1093.7 1191.0 1311.1

1132.0 132.7 1351.

1975--APR. MAY JUNE

34,477 34,143 34,490

34,367 34,077 349263

106,331 106,647 107,833

500.8 501.2 506.5

703.7 706.7 709.7

284.9 267.6 291.0

626.7 633.7 642.4

1012.7 1025.3 1040.2

715.1 718.8 726.5

1101.1 1110.4 1124.3

1222.8 1232.4 1247.7

1267.k 1276.3 1290.7

JULY AUG. SEPT.

34,399 34,310 34,421

34,098 34,099 34,024

108,254 108,694 108,949

505.1 503.3 505.5

710.9 714.9 716.1

291.9 293.2 293.6

647.5 650.6 652.9

1051.6 1060.6 1068.1

729.6 729.3 731.9

1133.7 1139.3 1147.1

1260.1 1267.5 1274.4

1302.1 1368.6 1314.6

OCT. NOV. DEC.

34,239 34,515 34,539

34,046 34,455 34,409

109,279 110,287 110,930

508.0 514.1 514.4

719.7 726.0 721.6

293.4 295.6 294.8

655.8 662.1 664.3

1075.8 1086.5 1092.9

736.7 743.9 747.2

1156.6 1168.3 1175.8

1286.2 1302.2 1311.1

1326.3 1342.6 1351.5

1976--JAN. FEB. MAR.

34,245 34,052 34,003

34,167 33,971 33,949

111,171 111,538 112,192

514.1 515.6 516.0

724.8 729.7 734.7

295.1 296.5 298.0

670.2 678.5 663.4

1103.7 1117.2 1127.3

749.4 753.8 756.6

1182.9 1192.6 1200.4

1318.7 1329.3 1336.2

1359.1 1369.5 1378.4

34,037

33,993

113,344

517.4

737.7

301.8

692.1

1141.2

763.4

1212.5

1351.4

1391.6

33,834 33,843 33,876 34,315

33,786 33,803 33,798 34,279

111,863 112,025 112,212 112,749

515.7 516.7 515.9 515.3

298.9 298.3 296.9 298.2

683.7 683.5 682.8 685.1

756.7 756.5 755.8 758.4

7 14 21 28P

33,865 33,805 34,130 34,126

338,41 33,744 34,091 34,073

312,438 112,937 113,940 113,777

517.3 517.9 519.6 515.2

299.6 302.8 303.3 301.9

688.6 693.1 693.0 693.4

761.8 765.1 763.8 763.1

34,813

34,773

114,333

515.8

302.6

694.6

763.7

MONTHLY:

APR.

WEEKLYt

1976-MAR. 10 17 24 31 APR.

MAY

ADJUSTED CREDIT PROXY INCLUDES MAINLY TOTAL MEMBER BANK DEPOSITS SUBJECT TO RESERVE REQUIREMENTS, LOANS SOLD TO BANKRELATED INSTITUTIONS, AND EURODOLLAR BORROWINGS OF U.S.BANKS. MEEKLY DATA ARE DAILY AVERAGES FOR STATEMENT WEEKS. MONTHLY DATA ARE DAILY AVERAGES. WEEKLY DATA ARE NOT AVAILABLE FOR M3, M5S M6, NM, TOTAL LOANS AND INVESTMENTS AND THRIFT INSTITUTION DEPOSITS. 1/ BASED ON DATA ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS. P - PRELIMINARY

NOTESt

APPENDIX TABLE 2-A

MAY 14,

COMPONENTS OF MONEY STOCK AND RELATED MEASURES Currency

Period

Demand

posit 2

Total Time

Deposits 3

REVISED SERIES

ANNUALLY: 1973 1974 1975

8.1 10.2 8.7

5.3 3.0 2.6

16.2 15.0 7.9

1974

9.9

2.1

10.6

1ST HALF 1975 2ND HALF 1975

9.4 7.6

4.4 0.9

7.8 7.8

Time

Mutual

Other h

Savings Bank

Tha

CD's

and S L Sharesj Shares!i

I Credit Union

Short CD's

ShareBonds

Savings _

6 7 (Per cent annual rates of growth)

11.4 9.4 32.2

8.5 5.6 15.8

13.8 12.1 20.2

8.0

6.1

13.4 10.4

15.2 15.2

Term

U.S. Gov't

Commercial er

Per

Securitie_

45.6 41.4 -7.7

4.9 4.8 6.3

31.3 11.9 21.0

39.3 9.1 -3.3

11.5

20.9

5.2

4.4

20.9 17.6

-12.7 -2.9

5.7 6.8

6.7 34.0

5.7 -12.1

-9.1 -24.2 0.0

SEMI-ANNUALLY: 2ND HALF

QUARTERLYt 2ND OTR. 3RD OTR. 4TH QTR.

1975 1975 1975

9.2 5.6 9.4

9.9 2.9 -1.1

6.3 2.6 12.9

14.6 8.9 11.6

17.7 17.4 12.5

20.6 17.0 17.6

-25.4 -23.8 19.2

5.6 6.8 6.6

7.0 19.2 46.6

1ST QTI.

1976

10.9

2.4

5.4

17.1

14.3

14.4

-47.3

5.9

8.2

-2.0

QUARTERLY-AV: 2ND QTR. 3RDO TR. 4TH QTR.

1975 1975 1975

8.1 8.5 8.4

6.9 6.6 0.2

4.5 4.7 9.7

12.5 12.7 9.8

16.2 18.2 14.0

21.0 18.6 16.5

-24.5 -27.5 9.5

5.6 6.8 6.7

-2.8 26.4 30.7

9.3 -23.7 -8.7

1ST OTR.

1976

9.8

0.4

7.8

15.9

13.4

15.9

-29.3

5.4

17.0

0.0

1975--APR. MAY JUNE JULY AUG. SEPT. OCT. NOV. DEC.

1.7 12.1 13.7 5.1 10.1 1.7 10.0 13.2 4.9

3.9 11.1 14.4 3.3 3.8 1.6 -4.3 7.1 -5.9

3.9 3.1 12.0 5.8 -3.8 5.8 13.7 13.5 11.0

9.9 15.1 18.4 14.0 6.4 6.0 10.7 13.6 10.1

16.4 17.2 18.9 18.9 17.7 14.9 13.5 12.4 11.3

20.6 20.3 19.9 15.7 19.4 15.2 18.8 14.8 18.3

-18.7 -44.8 -14.1 -28.5 -48.2 4.6 27.3 13.4 16.1

5.6 5.6 5.6 9.2 5.5 5.5 7.3 7.2 5.4

0.0 -2.1 23.1 53.6 27.6 -23.2 37.4 78.2 19.7

10.9 -13.5 -24.6 -25.1 -28.5 -20.4 -5.9 6.0 0.0

1976-JAN. FEB. MAR. APR.

8.1 14.6 9.6 17.4

-1.1 3.8 4.3 15.1

5.3 7.7 3.1 8.1

18.2 21.4 11.0 15.3

13.4 14.7 14.2 14.1

18.0 10.7 14.1 10.4

-53.6 -57.6 -36.6 -29.5

5.3 5.3 7.1 5.3

1.8 10.6 12.2 13.8

0.0 -3.0 -3.0 -3.0

MONTHLY

1/ P -

GROWTH RATES ARE BASED ON ESTIMATED PREVIOUS MONTH REPORTED DATA. PRELIMINARY.

MONTHLY

AVERAGE

LEVELS DERIVED

BY AVERAGING

END

OF CURRENT

MONTH

AND END OF

1976

APPENDIX TABLE 2-B

MAY 14,

1976

COMPONENTS OF MONEY STOCK AND RELATED MEASURES Period

Currency

Demand Ped

Time

Mutual

Total

Other

Savings

Credit

Time Deposits

r TCDn

Bank and S & L

Union Shares

CD's

_ Di

Short

Savings

Commercial

Non-

U.S.

ommerca Paper y

deposit Funds

Gov't Demand

Scurities 9

Term

dsais Ter yB U.S. Gvt

REVISED SERIES ANNUALLY: 61.5 67.8 73.7

209.0 215.3 221.0

364.4 419.1 452.4

300.9 329.3 369.6

323.5 341.6 395.5

24.7 27.7 33.3

63.5 89.8 82.9

50.3 56.3 68.1

38.3 41.8 40.4

6.6 8.4 8.4

5.0 3.4 3.0

69.5 70.2 71.0

215.4 217,4 220.0

430.1 431.2 435.5

341.8 346.1 351.4

356.7 361.8 367.5

29.6 30.1 30.6

81.4 85.1 84.1

57.2 57.1 58.2

44.4 43.9 43.0

6.7 7.4 7.0

2.7 2.5 3.2

JULY AUG, SEPT.

71.3 71.9 72.0

220.6 221.3 221.6

437.6 436.2 438.3

355.5 357.4 359.2

373.3 378.8 383.5

31.0 31.5 31.9

82.1 78.8 79.1

60.8 62.2 61.0

42.1 41.1 40.4

6.8 7.0 7.0

2.6 2.8 3.0

OCT. NOV. DEC.

72.6 73.4 73.7

220.8 222.1 221.0

443.3 448.3 452.4

362.4 366.5 369.6

387.8 391.8 395.5

32.4 32.8 33.3

80.9 81.8 82.9

62.9 67.0 68.1

40.2 40.4 40.4

7.9 8.2 8.4

3.0 3.9 3.0

74.2 75.1 75.7

220.8 221.5 222.3

454.4 457.3 458.5

375.2 381.9 385.4

399.9 404.8 409.6

33.8 34.1 34.5

79.2 75.4 73.1

68.2 69.5

40.4 40.3 40.2

7.9 8.0 8.2

2.6 2.6 2.5

76.8

225.1

461.6

390.3

414.4

34.8

71.3

70.3

40.1

7.5

2.5

10 17 24 31

75.8

75.9

223.1 222.6 221.0 222.4

457.8 458.2 458.9 460.1

384.8 385.2 386.0 386.9

73.0 73.0 73.0 73.3

8.3 8.5 8.2

2.9 2.8 2.8 1.9

APR.

7 14 21 28P

76.3 76.6 77.2 76.9

223.3 226.1 226.0 224.9

462.3 462.3 460.6 461.2

389.0 390.3 389.8 391.5

73.2 72.0 70.8 69.7

7.2 7.2 8.0 7.6

2.4 2.5 3.6 1.9

MAY

77.0

225.5

461.2

392.1

69.1

7.3

1.7

1973 1974 1975

MONTHLY 3975--APR. MAY JUNE

1976--JAN. FEB. MAR. APR.

68.8

WEEKLY: 1976--MAR.

I/ P -

~~ ~ I

75.8 75.9

_ .--... -~_._ .-_;- N -.-^ ESTIMATED MONTHLY AVERAGE LEVELS DEKVtED BY AVERAbNlb DATA. PRELIMINARY

=.-END OU

__CURRENT

.-. UPNTH AND

-~__. END UP

-; PREVIOUS

-i_ *-.-_. 'h MOUNH REPORTED DAIA.

-~.

Appendix Table III Growth Rate in Money Supply (Per cent change in an annual rate)

(Revised Series)

14,

3.6

7.4

7.3

9.2

8.4

10.3

10.1

6.4

9.9

8.2

9.8

8.5

III

1.8

5.5

6.3

7.9

6.1

7.8

5.1

9.0

9.9

8.4

QIV '72-QIV '73

6.0

6.2

8.8

9.0

1974

5.3

6.0

9.0

9.6

8.4

8.9

5.3

5.6

6.9

7.4

5.7

6.5

III

3.0

4.2

5.5

6.4

5.2

5.6

4.7

4.0

6.6

6.4

7.2

6.5

QIV '73-QIV '74

4.7

5.0

7.2

7.7

6.8

7.1

1975

1.4

0.6

6.9

5.6

9.0

7.5

9.7

7.4

III

3.6

7.1

1.6

QIV '74-QIV '75 1976

1973

10.5

12.5

10.2

14.5

12.6

6.5

10.1

10.7

13.3

2.3

7,0

6.4

4.1

4.4

8.5

8.3

4.3

2.6

11.5

10.1

9.3

9.4

11.3

11.1

12.6

11.4

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

Appendix Table IV Projected Federal Funds Rates

1976

1977

QII

Alt. A

Alt. B

Alt. C

4-7/8

5-1/8

5-3/8

QIII

QIV

Appendix Table V

Reserve Measures Consistent With Short-run Alternatives (seasonally adjusted)

Nonborrowed reserves

Member-bank borrowing Excess reserves

previous 4-week period ($ million)

Alt. C

Alt. A

-218

4.1

219

-36

-49

-62

34,219

143

6.1

5.1

4.2

Alt. A

Alt. B

Alt. C

34,246

34,164

33,944

275

175

162

59 188

2-month Annual Percentage Growth Rate for May-June

Change from average of

Average of 5 weeks May 26 to June 23 ($ million)

Alt. B

Alt. C -0.7

Other reserve aggregates: Total reserves

34,305

34,261

Monetary base

114,765

114,721 114,679

866

822

780

9.0

8.7

8.4

Nonborrowed monetary base

114,706

114,625

114,404

863

782

561

8.9

8.4

6.9

1/ Total reserves plus currency held outside the Treasury, the Federal Reserve, and member banks.

Appendix Table VI Comparison of Old and Revised Money Stock Growth Rates (Per cent annual rate) M1

1975

1976

Old

Revised

Old

Revised

Old

Revised

Oct.

-0.8

5.1

5.3

8.4

8.7

Nov.

9.4

9.0

10.8

11.5

11.6

Dec.

-2.8

-3.2

3.1

4.0

6.5

Jan.

1.2

10.3

10.7

11.6

11.9

Feb.

6.5

5.7

14.3

14.9

14.4

14.7

Mar.

6.1

6,1

8.3

8.7

10.5

10.8

April

15.7

15.3

14.6

15.3

14.5

14.8

11.9 7.1

Quarterly:1975

1.9

1.6

6.4

7.0

8.9

1976

4.6

4.3

11.1

11.5

12.3

9.3 12.6

Quarterly average: 1975

2.5

2.3

6.1

6.4

9.2

1976

3.0

2.6

9.5

10.0

11.1

1/ End-month-of-quarter to end-month-of-quarter.

9.4 11.4

May 17, 1976

CORRECTION Monetary Aggregates and Money Market Conditions (Blue book)

In appendix A (which follows charts 1-3 and tables 1-6), the numbering of pages A-2 and A-3 should be reversed.

Cite this document

APA

Federal Reserve (1976, May 17). Bluebook. Bluebooks, Federal Reserve. https://whenthefedspeaks.com/doc/bluebook_19760518

BibTeX

@misc{wtfs_bluebook_19760518,
  author = {Federal Reserve},
  title = {Bluebook},
  year = {1976},
  month = {May},
  howpublished = {Bluebooks, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/bluebook_19760518},
  note = {Retrieved via When the Fed Speaks corpus}
}