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OiSO X-7313 F E D E R A L R E S E R V E B O A R D STATEMENT FOR THE PRESS The following summary of general business and financial conditions in the United States, "based upon statistics for the months of November-and December will appear in the forthcoming issue of the Federal Reserve Bulletin and in the monthly reviews of the Federal reserve "banks. For release in Morning Papers, Saturday, December 24, 1932. Industrial activity declined in November "by somewhat more than the usual seasonal amount. Changes in factory employment and payrolls, reported for the middle of the month, were largely seasonal in character. Prices in wholesale commodity markets were somewhat lower, on the average, in November than in October, and declined further during the first three weeks of December. Production and employment - Volume of industrial production, as measured by the Board's seasonally adjusted index, declined from 66 per cent of the 1923—1925 average in October to 65 per cent in November, compared with a low level of 58 per cent in July. Output at woolen mills, silk mills, and shoe factories declined in November from the relatively high levels of the autumn, while cotton mills continued active. Lumber production declined by considerably more than the usual seasonal amount. Steel production decreased during Novem- ber and the first three weeks of December, while automobile output increased considerably in connection with the introduction of new models. The number employed at factories declined somewhat from October to November, reflecting in large part developments of a seasonal character. Working force's in the woolen, silk, shoe, and canning industries were reduced, while at car-building shops and at factories producing automobiles and agricultural implements there were increases in employment. X-7313 53G — 2 — Construction contracts awarded up to December 15, as reported "by the F. 17. Dodge Corporation, indicate for the last three months of the year a decline from the third quarter of somewhat more than the usual seasonal amount, following a non-seasonal increase from the. second to the third quarter. Estimates of the Department of Agriculture, based on December 1 reports, indicate a cotton crop of 12,727,000 "bales, about 800,000 "bales larger than the estimate a month earlier, "but 4,400,000 "bales smaller than last year's unusually large crop. Wheat, tobacco, flaxseed, and other leading cash crops are also considerably smaller than a year ago, while feed crops are substantially larger. Acreage of winter wheat planted this fall was slightly smaller than a year ago, and condition of the crop on December 1 was unusually poor, according to the Department of Agriculture. Distribution - Distribution of commodities by rail decreased seasonally from October to ITov ember, while the dollar volume of department store sales, which ordinarily expands at this season, showed a decline. Wholesale prices - During early ITov ember the general level of wholesale commodity prices advanced somewhat, reflecting chiefly increases in prices of domestic agricultural products; in the latter part of the month, however, prices of livestock, cotton, and grains declined considerably; and, during the first three weeks of December, further declines in livestock prices were reported. By the third week of December prices of textiles, copper, and silver, as well as of livestock, were substantially lower than in the middle of ITovember and the general average of wholesale prices was at a level slightly below that prevailing before the advance that occurred last summer. Bank credit - During the four weeks ended December 14 there was an addition of $85,000,000 to the country's stock of monetary gold. The funds X-7313 5 3 7 - 3 - derived from this source were utilized in meeting an increase in the demand for c u r r e n c y , which was smaller than usual at this season, in further reducing by $23,000,000 the indebtedness of member banks to the reserve banks, and in increasing by $25,000,000 the volume of me:.iber bank reserve balances. On December 15 there was a further increase of $95,500,000 in the stock of monetary gold in connection with the current payment by Great Britain on the war debt. This amount of gold was earmarked in London for account of the Federal Reserve Bank of Hew York, and an equivalent credit was given by that bank to the United States Treasury. This transaction together with other fiscal operations on December 15 resulted in a temporary addition of $100,000,000 to the reserves of member banks, which were subsequently reduced by Christmas currency demands, and an increase in Treasury deposits with the reserve banks. Loans and investments of reporting member banks declined by more than $100,000,000 between November 16 and December 14, reflecting reductions in the banks' holdings of United States Government securities, and in loans other than security loans. Loans on securities increased, both at Hew York City and at other reporting member banks. Money rates in the open market declined further, rates on 90-day bankers' acceptances declining from l/2 of 1 per cent to 3/8 of 1 per cent, and rates on prime commercial paper from a range of 1 l/2 - 1 3/4 per cent to a range of 1 l/4 - 1 l/2 per cent.
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