fomc minutes · November 17, 1975

FOMC Minutes

Meeting of Federal Open Market Committee

November 18, 1975

MINUTES OF ACTIONS

A meeting of the Federal Open Market Committee was held

in the offices of the Board of Governors of the Federal Reserve

System in Washington, D. C.,

on Tuesday, November 18, 1975, at

9:00 a.m.

PRESENT:

Mr.

Burns, Chairman

Volcker, Vice Chairman

Baughman

Bucher

Coldwell

Eastburn

Holland

Jackson

MacLaury

Mayo

Mitchell

Wallich

Messrs. Black and Winn, Alternate Members

of the Federal Open Market Committee

Messrs. Clay, Kimbrel, and Morris,

Presidents of the Federal Reserve Banks

of Kansas City, Atlanta, and Boston,

respectively

Mr. Broida, Secretary

Mr. Altmann, Deputy Secretary

Mr. Bernard, Assistant Secretary

Mr. O'Connell, General Counsel

Mr. Partee, Senior Economist

Mr. Axilrod, Economist (Domestic Finance)

Mr. Gramley, Economist (Domestic Business)

Messrs. Boehne, Davis, Green, Kareken,

Reynolds, and Scheld, Associate Economists

11/18/75

Mr. Holmes, Manager, System Open Market Account

Mr. Pardee, Deputy Manager for Foreign

Operations

Mr. Sternlight, Deputy Manager for Domestic

Operations

Mr. Coyne, Assistant to the Board of

Governors

Mr. Keir, Adviser, Division of Research and

Statistics, Board of Governors

Mr. Gemmill, Adviser, Division of International

Finance, Board of Governors

Mrs. Farar, Economist, Open Market Secretariat,

Board of Governors

Mrs. Ferrell, Open Market Secretariat

Assistant, Board of Governors

Messrs. Leonard and Williams, First Vice Presidents,

Federal Reserve Banks of St. Louis and San

Francisco, respectively

Messrs. Eisenmenger, Parthemos, and Doll,

Senior Vice Presidents, Federal Reserve

Banks of Boston, Richmond, and Kansas

City, respectively

Messrs. Hocter, Brandt, Balbach, and Keran,

Vice Presidents, Federal Reserve Banks

of Cleveland, Atlanta, St. Louis, and

San Francisco, respectively

Mr. Ozog, Manager, Securities and Acceptances

Division, Federal Reserve Bank of New York

By unanimous vote, the minutes of actions taken at the

meeting of the Federal Open Market Committee on October 21, 1975,

were approved.

11/18/75

By unanimous vote, the System open market transactions in

foreign currencies during the period October 21 through November 17,

1975, were approved, ratified, and confirmed.

By unanimous vote, the Committee approved the renewal for

further periods of up to one year of the following swap arrange

ments, having the indicated amounts and maturity dates:

Foreign bank

Amount of

arrangement

(millions of

dollars

equivalent)

Austrian National Bank

250

National Bank of Belgium

1,000

2,000

Bank of Canada

250

National Bank of Denmark

Bank of England

3,000

2,000

Bank of France

German Federal Bank

2,000

Bank of Italy

3,000

2,000

Bank of Japan

Bank of Mexico

360

Netherlands Bank

500

250

Bank of Norway

Bank of Sweden

300

1,400

Swiss National Bank

Bank for International Settlements:

Dollars against

Swiss francs

600

Dollars against other

authorized European

currencies

1,250

Term

(months)

Maturity date

1975

December

1975

December

1975

11/18/75

By unanimous vote, the open market transactions in Government

securities, agency obligations, and bankers' acceptances during the

period October 21 through November 17, 1975, were approved, ratified,

and confirmed.

With Messrs. Volcker, Eastburn, and Jackson dissenting, the

Federal Reserve Bank of New York was authorized and directed, until

otherwise directed by the Committee, to execute transactions in the

System Account in accordance with the following domestic policy

directive:

The information reviewed at this meeting suggests

that output of goods and services--which had increased

sharply in the third quarter--is expanding more moderately

in the current quarter. Retail sales are reported to have

risen in October, after 2 months of little net change.

Industrial production and nonfarm payroll employment con

tinued to recover, although at a less rapid rate than in

the summer months. The unemployment rate rose to 8.6 per

cent from 8.3 per cent in September, reflecting a sizable

increase in the civilian labor force. Average wholesale

prices of industrial commodities increased more in October

than in the immediately preceding months, and prices of

farm and food products rose sharply further. However,

since mid-October prices of many agricultural products

have declined. The advance in average wage rates in

October was substantial.

Since mid-October the exchange value of the dollar

against leading foreign currencies has moved in a narrow

range. The U.S. foreign trade surplus in September

remained substantial, as both exports and imports rose

moderately. Bank-reported private capital flows appear

to have shifted to net outflows since September, and the

volume of offerings of new foreign bonds in the U.S.

market has been at record levels.

11/18/75

M1 rose at a 6.9 per cent annual rate from the

average level during the second quarter to the average

level during the third quarter. However, M1 grew rela

tively little in the months of the third quarter and it

declined in October. Inflows of consumer-type time and

savings deposits to banks and to nonbank thrift institu

tions remained moderate in October, and growth in M

and M3 slowed further. Most short- and long-term interest

rates have declined further in recent weeks. Conditions

in markets for State and local government securities have

continued to be adversely affected by New York's financial

problems.

In light of the foregoing developments, it is the

policy of the Federal Open Market Committee to foster

financial conditions that will encourage continued

economic recovery, while resisting inflationary pres

sures and contributing to a sustainable pattern of

international transactions.

To implement this policy, while taking more than

usual account of developments in domestic and interna

tional financial markets, the Committee seeks to achieve

bank reserve and money market conditions consistent with

moderate growth in monetary aggregates over the months

ahead.

It was agreed that the next meeting of the Committee would

be held on December 16, 1975, at 9:00 a.m.

The meeting adjourned.

Secretary

Cite this document

APA

Federal Reserve (1975, November 17). FOMC Minutes. Fomc Minutes, Federal Reserve. https://whenthefedspeaks.com/doc/fomc_minutes_19751118

BibTeX

@misc{wtfs_fomc_minutes_19751118,
  author = {Federal Reserve},
  title = {FOMC Minutes},
  year = {1975},
  month = {Nov},
  howpublished = {Fomc Minutes, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/fomc_minutes_19751118},
  note = {Retrieved via When the Fed Speaks corpus}
}