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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 14, 1970. MONETARY AGGREGATES AND MONEY MARKET CONDITIONS Recent developments (1) The money supply is now estimated to have increased at a 4.1 per cent annual rate on average in July, much slower than the 11 per cent pace indicated at the time of the last Committee meeting. Since around mid-July, the weekly money supply figures have been generally smaller than earlier anticipated, though the shortfall has lessened in August and in the week ending August 12, the preliminary estimate for the money supply moved slightly above its indicated path. For the most part the shortfalls in money supply reflected weakness in private demand deposits subject to reserves at both city and country banks, but currency and estimated demand deposits at nonmember banks also fell short./ Apparently, the surge in demand balances around mid-year was a very temporary phenomenon, perhaps resulting from market churning associated with shifts of funds out of market instruments thought to be of less than prime quality. (2) Growth in the adjusted bank credit proxy in July was at a slightly more rapid pace than had been expected earlier. This greater strength was due primarily to a faster-than-projected rise in time deposits, which grew at a 35 per cent annual rate on average in July. Large CD's rose by around $5.0 billion over the month following the suspension of a 1/ There have been some indications of the development recently of new bank accounting procedures in connection with Euro-dollar and foreign exchange transactions which could be producing some understatement in the money supply series. No hard statistics are available, however, to confirm the extent of such a bias if it does exist, whether it is growing or represents a one-time change, or whether it is or isn't offset by other factors. -2portion of the Regulation Q ceilings, although more recent data indicate a considerably more moderate rate of CD expansion. Other time and savings deposits also advanced strongly in July, possibly reflecting a preference by savers for highly liquid instruments in view of economic and financial uncertainties. Net inflows of funds to nonbank savings institutions were also exceptionally strong after allowance for seasonal factors. Recent Paths of Key Monetary Aggregates (Seasonally adjusted, billions of dollars) Adjusted Credit Proxy Indicated at Last Meeting Actual Results Money Supply Indicated at Last Meeting Actual Results 1970 Month Levels Levels June 311.2 311.1 203.7 203.6 July 315.6 315.8 205.6 204.3 July 15 314.4 314.2 205.4 204.3 22 315.5 315.0 206.0 202.8 29 317.9 318.8 205.8 204.3 318.3 319.4 205.5 204.5 318.7 320.6e/ 205.7 206.4e/ Week ending August 5 12 Z Annual Rates of Change % Annual Rates of Change Month July over June e/ 17.0 Partly estimated. 18.1 11.0 4.1 (3) successful figures. The Treasury's mid-August financing was generally raising $1.9 billion in new cash, according to preliminary Despite the success of the financing and the initial premiums on the new issues, the Government securities market remains hesitant in the face of enlarged dealer positions arising from the Treasury's two tax bill auctions in July and takings of about $1.4 billion in coupon issues in the mid-August operation. Thus, yields on Treasury notes and bonds have edged up and are about 7--10 basis points over mid-July levels. Treasury bill rates have also moved somewhat higher, and the 3-month issue was most recently bid at 6.54 per cent, compared with 6.38 per cent at the time of the last meeting. (4) Yields on new high-grade corporate issues have fluctuated since mid-July, and on balance are a shade higher than at the time of the last FOMC meeting, reflecting a recent build-up in the corporate calendar. On the other hand, yields on municipal securities have dropped. Private short-term rates have also declined since mid-July; and these markets have calmed considerably, although the market remains very quality- conscious and marginal issuers of commercial paper are still being pressed to seek alternative sources of credit. Major finance companies are now having relatively little difficulty in meeting maturities, although some are finding it hard to add to outstandings. Nevertheless, as reported in the Greenbook, total outstanding commercial and finance paper continued to decline in July, a month in which seasonal factors would imply a sizable increase. (5) In response to the System's discount window assistance to banks extending additional credit to commercial paper issuers, member bank borrowings rose sharply in July reaching a record $1.7 billion on average in the week of July 15. Over the past three statement weeks, however, member bank borrowings have been in a $1--$1.2 billion range, at a time when pressures on the commercial paper market have been abating. Net borrowed reserves fluctuated in a $1.1--$1.4 billion range in the latter part of July, but in the first two statement weeks of August dropped below $1.0 billion; in June, before the commercial paper problem developed, net borrowed reserves had averaged $735 million. (6) Since the last Committee meeting, the Federal funds rate has averaged a little below 7 per cent, as compared with the 7-1/4-7-1/2 per cent range of the preceding four weeks. In part, the lower Federal funds rate reflected increased ability of banks to accommodate reserve needs at the discount window. In addition, however, the drop in the funds rate, and also dealer financing rates, reflected the Desk's response to shortfalls in money supply growth. (7) The following table summarizes seasonally adjusted annual rates of change in major aggregates for selected periods: Past Year (July over July) First Half of 1970 (June over December) Latest Month (July over June) 0.2 - 0.2 5.3 -0.1 1.9 -16.7 Money supply 2.5 4.0 4.1 Time and savings deposits 4.7 7.1 35.2 Savings accounts at nonbank thrift institutions 4.1 4.5 11.6 2.8 3.3 22.7 Proxy plus Euro-dollars 1.8 1.9 18.6 Proxy plus Euro-dollars and other nondeposit sources 3.3 3.5 18.1 Total loans and investments of all commercial banks 3.3 1.9 16.6 L&I plus loans sold outright to affiliates and foreign branches 4.6 3.9 16.6 Non-bank commercial paper 12.81/ 14.0 -63. 91/ Total reserves Nonborrowed reserves Member bank deposits and related sources of funds Total member bank deposits (Bank credit proxy) Commercial bank credit (Month end) NOTE: All items are averages of daily figures (with "other nondeposit sources" based on an average for the month of Wednesday data), except the commercial bank credit series, which are based on total outstanding on last Wednesday of month, and the non-bank commercial paper and thrift institutions series, which are end-of-month data. All additions to the total member bank deposit series are seasonally unadjusted numbers, since data have not been available for a long enough time to make seasonal adjustments. 1/ Last Wednesday of July 1970. Last day of month not available. Prospective developments (8) If the Committee wishes to continue with a policy that encompasses financial flows and credit conditions consistent with a 5 per cent trend rate of growth for the money supply, the following language for the second paragraph of the directive may be considered (alternative A): To implement this policy,[DEL: while taking account of persisting market uncertainties;liquidity strains; and the forthcoming Treasury financing;]the Committee seeks to promote moderate growth in money and bankcredit over the months ahead, WHILE TAKING ACCOUNT OF PERSISTING LIQUIDITY PROBLEMS AND allowing [DEL: for a possible] BANK CREDIT GROWTH TO REFLECT A continued shift of credit flows from market to banking channels. System open market operations until the next meeting of the Committee shall be conducted with a view to maintaining bank reserves and money market conditions consistent with that objective; [DEL: provided, however, that operations shall be modified as needed to counter excessive pressures in financial markets should they develop.] (9) The table below shows growth paths for the monetary aggregates that would be consistent with such a policy. Monetary Aggregates--Monthly and Quarterly (Daily averages, seasonally adjusted) Money Supply Month Levels Annual Rate -$ bills.) of change Adjusted Credit Proxy Levels Annual Rate ($ bills.) of change Total Reserves Annual Levels Rate of ($ bills) Change June (actual) 203.6 -1.8 311.1 7.0 27.9 .5 July (actual) 204.3 4.1 315.8 18.1 28.0 5.3 August 205.4 6.5 321.0 20.0 28.6 24.0 September 206.2 4.5 323.8 10.5 28.8 11.0 October 206.8 3.5 327.3 13.0 29.1 12.0 1/ Quarters- 3rd (Sept. over June) 5.0 16.5 13.5 4th (Dec. over Sept.) 5.0 11.5 13.0 1/ The annual rate of change on a quarterly-average over quarterly-average basis for the money stock is 3.5 per cent inthe third quarter and 4.5 per cent in the fourth quarter. (10) The growth rate specified above might not be attainable under prevailing money market conditions, particularly with respect to the money supply. Although the relationship between money market conditions and monetary aggregates has been unusually uncertain recently, our projections indicate that the money supply might grow at no more than a 4 per cent annual rate over the third quarter and into the fourth if current money market conditions are generally maintained. Achievement of a 5 per cent money supply growth might require a Federal funds rate generally around 6-1/2-6-3/4 per cent, member bank borrowings dropped to an average of around $800-$900 million, and net borrowed reserves were in a $700-$800 million -8range. Such a set of money market conditions might be accompanied by some decline of interest rates in short-term credit markets in consequence of greater provision of nonborrowed reserves by the System. The 3-month bill rate would probably decline in a 6-1/8--6-1/2 per cent range. It is possible, also, that if the Federal funds rate had to be consiztently around 6-1/2 per cent to achieve the money supply growth, expectational factors could be generated which could increase bank and other investor demands for debt obligations. This might lead to interest rate declines on a broader front, although the extent of decline may be limited by the size of security offerings in prospect. (11) Time deposit growth is likely to slow over the months ahead even if the easier money market conditions noted above prove necessary. It seems unlikely that the very rapid rate of growth of consumer-type time deposits in July will continue, assuming that economic prospects begin to improve. With respect to large negotiable CD's, the recent more moderate pace of expansion is likely to continue. Further short-term market rate declines would tend to make CD's relatively more attractive to investors, but, with loan demands quite moderate, banks would be unlikely to be as aggressive in the CD market as in July. This same consideration is likely to limit bank interest in nondeposit sources of funds. (12) A weekly path for monetary aggregates consistent with the monthly figures is shown below: Monetary Aggregates--Weekly (Daily averages, seasonally adjusted) Week Money Supply Credit Proxy Adjusted Total Reserves August 12/ 206.4 320.6 28.6 19 206.2 321.3 28.6 26 204.8 321.8 28.8 2 204.8 322.1 28.8 9 206.2 322.4 28.7 16 206.4 323.8 28.8 Sept. e/ Partly estimated. -10Alternative (13) Should the Committee wish to seek a somewhat more rapid pace of growth for the money supply and an associated easing of credit conditions between now and year-end, following language it may wish to consider for the second paragraph of the directive the (alterna- tive B): To implement this policy, [DEL: while taking account market-uncertainties; liquidity strains; andthe Treasury financing of persisting forthcoming the Committee seeks to promote SOMEWHAT GREATER moderate growth in money and bankcredit]over the months ahead, WHILE TAKING ACCOUNT OF PERSISTING LIQUIDITY PROBLEMS AND allowing for-a-possible of credit flows BANK CREDIT GROWTH TO REFLECT A continued shift from market to banking channels. market operations until System open the next meeting of the Committee shall be conducted with a view to maintaining bank reserves and money market conditions consistent with that objective provided;[DEL:however, that operations shall be modified as needed to counter excessive pressures in financial markets should they develop.] (14) A monthly and quarterly path for the monetary aggregates, including a move up to a 6 per cent annual rate of growth for money supply in the fourth quarter, is shown below: -11- Monetary Aggregates--Monthly and Quarterly (Daily averages, seasonally adjusted, $ billions) Adjusted Credit Proxy Money Supply Total Reserves Levels Annual Rate Levels Annual Tate Levels Annual Rate ($ bills.) of Change of Change ($ bills.) of Change ($ bills.) Month June (actual) 203.6 -1.8 July (actual) 204.3 4.1 315.8 18.1 28.0 5.3 August 205.4 6.5 321.1 20.1 28.6 25.5 September 206.4 6.0 324.3 12.0 28.9 12.5 October 207.3 5.0 328.2 14.5 29.2 13.0 311.1 7.0 27.9 .5 Quarter-1/ 3rd (Sept. over June) 5.5 17.0 14.5 4th (Dec. over Sept.) 6.0 12.5 14.0 (15) Weekly figures for the period between now and the next meeting consistent with the above path, are detailed in table. the following -12Monetary Aggregates - Weekly (Daily average, seasonally adjusted, $ billion) Money Supply Credit Proxy Adjusted 206.4 320.6 28.6 19 206.2 321.4 28.7 26 204.8 321.9 28.8 2 204.8 322.3 28.9 9 206.4 322.8 28.8 16 206.6 324.2 28.9 Week August 12e/ Sept. e/ Total Reserves partly estimated (16) Encouragement of the more rapid growth in the money supply indicated above would entail a more generous provision of nonborrowed reserves by the System. As a result, net borrowed reserves would likely move into a $500-$700 million range, member bank borrowings drop to $650-$800 million, and the Federal funds rate might generally be in a 6--6-1/2 per cent range. A relatively sharp drop in Treasury bill rates, as well as other short-term rates, probably would accompany such an easing in the money market, particularly if the Federal funds the rate moves down close to/discount rate and engenders expectations of a discount rate reduction. bill ever, It is not improbable that the 3-month Treasury rate would drop below 6 per cent under those circumstances. Treasury net cash needs--at $6-$7 billion--are fairly large over the balance of the year and would serve to restrain interest rate declines. How- -13(17) In the easier monetary environment envisaged, banks would be likely to reduce offering rates on large CD's. Nevertheless, with market rates reduced, total time deposits would be expected to grow somewhat more rapidly than under alternative A. As a result of lower domestic interest rates and strong inflows of funds, banks would probably reduce Euro-dollar borrowings further, although whether individual banks will permit such borrowings to fall below their reserve-free base is not Banks would also reduce their reliance on commercial paper at all clear. as a source of funds. (18) The behavior of long-term interest rates would depend in large part on expectational reactions in the market to the over-all easing of monetary and credit conditions. It does not appear likely that a gradual upward adjustment in the rate of money supply increase would rekindle longer-run inflationary expectations, assuming the very modest growth path of real GNP shown in the greenbook and assuming fiscal policy does not become markedly more stimulative. Rather, the enhanced credit availability accompanying the money growth could be accompanied by declining bond yields over the short-run partly as corporate borrowers turn to bank lines of credit in anticipation of lower long-term borrowing costs later in the year. On balance, one might expect greater growth in money supply in the second half of this year to be consistent with declining long-term interest rates in corporate, municipal, and mortgage markets, although a pick-up in the volume of security offerings in the latter two markets would tend to act as a brake on the extent of rate decline. Table 1 MARGINAL RESERVE MEASURES (Dollar amounts in millions, based on period averages of daily figures) Member Free reserves Period Excess reserves Total Banks Borrow t C R e s e r v e Major banks 8 N.Y. Outside N.Y. i ngs Other Country Monthly (reserves weeks ending in): 1969--January February March April May June July August September October November December 477 580 635 844 -1,116 -1,078 -1,045 997 744 995 975 849 359 256 202 187 243 277 266 214 282 195 238 278 836 836 837 1,031 1,359 1,355 1,311 1,211 1,026 1,190 1,213 1,127 131 62 58 85 123 57 89 81 83 106 120 268 302 255 233 411 346 459 250 253 236 327 387 310 149 215 254 260 397 288 364 256 222 293 250 220 253 304 293 275 493 550 608 621 485 464 456 329 1970--January February March - 759 916 751 169 210 129 178 159 171 171 148 106 90 227 165 140 218 287 317 225 331 241 289 460 232 289 287 119 228 217 347 261 414 687 765 736 -1,145 928 1,126 880 865 924 907 1,316 I 8 15 22 29 - 610 317 9'15 811 783 339 179 102 158 111 949 496 1,017 969 894 232 -322 517 63 264 269 161 49 292 178 509 252 361 47 81 259 139 119 211 6 13 20 27 - 424 782 965 889 350 28 214 44 774 810 1,179 933 93 150 332 86 248 254 310 150 220 202 243 247 213 204 3 10 17 24 -1,029 721 390 799 195 136 268 88 1,224 857 658 887 269 195 -97 354 238 251 313 262 169 188 248 339 255 219 229 July 1 8 15 22 29 p 718 -1,219 -1,451 -1,201 -1,137 273 75 230 185 94 991 1,294 1,681 1,386 1,231 93 360 467 139 29 260 412 569 531 528 304 283 371 395 388 333 240 274 321 286 Aug. 5 p 12 p - 155 s 1,009 1,173 114 30 362 362 302 301 231 128 April May June July p 1970--.Apr. May June p - Preliminary. 854 045 1 278 188 290 261 291 ?Q7 450 Table 2 (In n es e r v e Total Reserves Period g a t e s Requ i red Reserves I Monetary M n e v __ Total Member Bank Deposits -~~~ ~ .. S u o Totial Currency Variab i v es 1 Private Demand Deposits 4 Annually 1968 1969 + 7.8 - 1.6 + 6.0 Semi-annually 1st Half 1969 2nd Half 1969 1st Half 1970 + 0.7 - 3.9 - 0.2 Quarterly 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter + + + 1st Quarter 1970 2nd Quarter 1970 e Nonborrowed Reserves I 1969 1969 1969 1969 AGGREGATE RESERVES AND MONETARY VARIABLES Retrospective Changes, Seasonally Adjusted per cent, annual rates based on monthly averages of daily figures) ( nmrcital bink time deposits adiusted Credit Prnxy + Euro-dollars + Iother nondep. sources of funds + 7.9 - 1.2 + 9.0 - 4.0 + 7.2 + 2.5 + 7.4 + 5.8 + 7.1 + 1.5 +11.5 - 5.3 n.a. n.a. - 3.7 - 2.4 + 1.9 + 1.0 - 3.3 - 3.5 - 4.6 + 3.3 + 4.3 + 0.6 + 4.0 + 6.5 + 4.9 + 8.3 + 3.7 - 0.6 + 2.9 -4.0 -6.7 + 7.1 n.a, - 1.2 + 3.5 - 2.8 - 4.7 - 4.8 - 0.1 + + + + + 4.1 + 4.5 + 3.2 + 4.2 - 1.3 -5.1 -3.0 -13.3 + 1.2 + + + + - 2.9 + 2.6 - 0.4 + 4.1 - 2.5 + 2.6 + 0.6 + 6.0 + 3.8 +42 + + + 2.9 + 2.8 + 0.4 +13.8 + 7.5 - 3.4 -3.8 -8.5 +19.9 - 7.6 + 4.5 - 4.9 - 8.0 -12.0 + 6.0 - 8.2 -19.3 - 2.8 + 7.7 -17.9 + 5.5 +12.1 +12.7 - 3.0 - 4.4 - 5.0 +14.3 - 8.6 -17.6 - 7.6 - 0.8 -10.4 + 9.3 + 6.9 - 3.2 - 1.2 -10.1 + 4.9 - 1.2 -10.2 -18.9 -11.3 + 1.7 - 9.2 + 9.7 + 6.2 + 3.1 + 3.1 +79 + 1 2 +12 +42 + 1.8 - 1.8 + + + + + + + + 2.8 8.3 8.2 2.7 8.1 8.1 5.4 8.0 -10.0 - 4.7 - 0.6 - 2.6 + 0.6 + 1.2 + 1.8 +10.6 + 7.9 + 7.1 + 1.6 + 0.8 +11.0 - 1.6 + 3.1 + 1.6 - 4.7 - 0.8 -0.8 -1.6 + 2.3 + 7.2 -15.6 + 7.5 +25.4 -19.0 + 6.2 -16.7 + 5.0 -12.9 - 4.2 - 8.0 +14.0 +16.8 - 4.5 + 5.8 +22.7 + 9.0 -10.7 +13.2 +10.7 + 3.5 - 1.8 + 4.1 + 5.2 + 7.8 + 7.8 + 7.7 +15.3 + 5.0 + 7.5 0.1 1.2 9.3 1.4 - 3.0 1.7 0.2 8.6 2.0 4.8 2.2 9.4 0.1 Addendum Nonbank commerc ia paper +27.6 +14.0 +31.0 + +22.4 + + +13.2 +14.3 - 3.6 - 5.4 -18.5 -19.4 - 2.5 -3.7 - 0.6 + 4.3 - 7.0 - 7.5 + 1.6 - 7.9 +13.1 + 0.8 +26.4 +23.8 +40.7 +20.0 +11.7 +34.2 -12.4 - 0.6 +14.4 +22.2 +10.3 + 8.4 +35.2 - 3.5 - 5.5 +10.7 +13.7 - 1.2 + 7.0 +18.1 + 3.6 +31 7 Monthly 1969--January February March April May June July August September October November December 1970--January February March April May June July p p - Preliminary. -22.5 -5.6 -11.7 + 9.7 + 6.3 + 3.1 -12.0 +21.3 -13.9 + 0.5 + 5.3 + 0.6 +22.2 -15.1 + 0.9 + 7.9 +10.1 -15.5 +14.1 +10.9 - 2.3 + 2.3 I 4 +J..3 +10.7 -37.3 n.a. Table 3 AGGREGATE RESERVES AND MONETARY VARIABLES Seasonally Adjusted (Based Reserve Aggregates Period Total reserves (In Nonborrowed reserves I/ Required reserves millions of dollars) on monthly averages of daily figures) Member Bank Deposits sbinorted by Reauired Reserves U .S. Gov't Private Time Tolal demand demand (member hank .i its Sdeposits deposs deposits 1/ denos - 4-. . . Si o n In b i Money Supply L~ ~- I Currency 2/ d ol a Total jLi of Commercial 'hink time Private deposits demand adjusted deoosits 3, 4, , Credit Prrxy + Eur -d l lars + othel n'ndep. sources of _ .rund I1 Addendum Nonbank commercial paper Monthly1969--January February March April May June July August September October November December 28,139 28,060 27,972 27,775 28,235 28,056 27, 30 27,401 27,402 "7. 154 27,783 27,928 27,318 27,206 27,024 26,754 26,888 26,705 26.275 26,214 26, 83 26.210 26,538 26,806 27,9 02 27,8 32 27,7 29 27,6 14 27,9 '42 27,7 42 27,3 134 27,1 61 27,1 64 27.1 29 27,548 27,707 297.0 296.7 294.2 295.4 295.1 292.6 288.0 285.3 28-.7 283.5 285.8 285.8 163.2 161.0 160.5 160.1 159.3 158.1 155.1 152.5 152.1 151.5 151.1 151.5 128.4 129.1 128.9 129.4 130.0 130.5 130.5 129.9 L19.2 128.9 129.1 129.4 54 6.7 48 5 9 59 40 2 4 29 44 3 1 56 4.9 195.8 196.3 196.8 198.1 198.3 199.0 199.3 199.0 199.0 199.1 199.3 199.6 43.5 43.8 44.1 44.2 44.5 44.8 45.0 45.3 45.2 45.6 45.9 45.9 152.3 152.5 152.6 154.0 151.8 154.2 154.4 153.8 15 1.7 15'1. 15 .4 193.7 203.2 202.4 202.3 202.3 201.7 200.8 197.7 194.5 194.1 19.5 193.4 194.1 307.5 105.7 303.8 A04.2 302.2 ^15.5 305.7 25.5 26.1 26.6 1970--January February March April May June July p 28,001 27,722 27,723 28,216 27,890 27,902 28,025 26,966 26,615 26,782 27,350 26,916 27,056 26,679 27,823 27,523 27,536 28,046 27,692 27,713 27,896 284.8 282.9 286.2 290.2 289.1 290.5 296.0 149.4 148.8 150.6 153.5 154.6 155.7 160.7 130.1 128.5 129.8 131.4 131.4 130.0 130.9 5.3 5.6 59 52 30 4.8 4.4 201.1 199.3 201.5 203.3 203.9 203.6 204.3 46.1 46.4 46.7 47.0 47.6 47.8 48.1 155.0 153.0 154.8 156.2 156.2 155.9 156.2 192.1 192.0 194.3 197.9 199.6 201.0 206.9 304.8 303.4 306.1 309.6 309.3 311. 1 315.8 29.1 30.0 30.0 31.8 32.0 31.0 n.a. 1/ 2/ 3/ 4/ / Private demand deposits include demand deposits of individuals, partnerships, and corporations and net interbank deposits. Includes currency outside the Tresury , the Federal Reserve, and the vaults of all commercial banks. Includes (1) demand deposit, at a11 commercial banks, other than those due to domestic commercial banks and theU.S. Government, less cash item, and(2) foreign demand balances at Federal Reserve Bank . process of collection and Federal Reservefloat, Excludes interbank and U S Government t ime deposit Incldes increases in rrquired reserves due to changes on Regulations M and D of approximately $400 million since October 16, 1969. in 29.0 Table 4 AGGREGATE RESERVES AND MONETARY VARIABLES Seasonally Adjusted Reserve Period 1970--Apr. 1 8 15 22 29 R es resees re ves reserves ervs (In millions of do lats) 27 .954 27,605 27,005 27 ,745 27,566 27,229 28 ,390 27,363 28,290 28 ,448 27,516 28,330 28,051 28 ,282 27,288 m I er link sI 2902.5 291.6 289.9 290.7 288.4 dpoits 152.0 152.9 153.2 153.8 154.2 oney Private .S. G ' L demand demand deposits 1/ deposits I n b i 1 1 ion 132.6 5.9 132.8 5.9 132.1 4.6 130.3 6.6 129.8 4.4 Total Commercial y upplybank d o of 206.8 204.7 203.7 202.5 201.7 Currency 2/ a r s 46.9 46.9 47.1 47.1 47.3 time Private demand deposits 3 47.6 47.7 47.8 47.8 156.4 155.7 156.0 154.3 200.0 200.5 200.7 201.0 310.8 310.6 311.1 310.5 32.1 2.4 202.3 204.5 206.0 207.6 209.1 312.2 314.2 31).2 315.0 318.8 29.7 29.8 29.0 29.3 29.8 210.2 211.2 319.4 320.6 29.5 n.a. 290.1 289.9 290.3 289.9 155.0 155.3 155.4 155.6 132.1 130.5 129.8 128.8 3.0 4.1 5.1 5.5 204.0 203.4 203.9 5.3 4.0 3.9 3.4 5.6 204.5 202.8 204.3 48.1 48.0 156.6 157.5 156.2 154.8 156.3 5.6 5.6 204.5 206.4 48.0 48.1 156.4 158.3 t 8 15 22 29 28,077 27,698 27,985 28,321 28,092 27,061 26,415 26,414 26,850 26,882 27,794 27,664 27,907 28,059 27,973 291.5 294.3 294.3 294.9 299.2 156.7 158.6 159.8 161.3 162.6 5 12 28,019 28,623 27,020 27,549 27,879 28,431 300.6 301.6 163.7 164,2 131.3 131.7 202.1 205.6 204.3 47.8 48.1 48.0 Private demand deposits include demand deposits of individuals, partnerships, and corporations and net interbank deposits. Includes currency outside the Treasury, the Federal Reserve, and the vaults of all commercial banks. Includes (1) demand deposits at all commercial banks, other than those due to domestic commercial banks and the U.S. Government, and (2) foreign demand balances at Federal Reserve Banks. process of collection and Federal Reserve float; 4/ Excludes interbank and U.S. Government time deposits. Weekly nonbank commercial paper are not seasonally adjusted. 5/ n a. - Not available. 1/ 2/ 3/ paper 31.7 32.1 32.0 32.3 27,602 27,714 27,744 27,659 199.5 131.8 130.6 130.3 131.0 Comiercl 309.0 307.9 309.5 310.6 27,028 27,419 26,870 ZD, IVL 27,917 28,002 27,645 26,559 NonhaLnk 199.1 199.2 199.7 199.9 3.2 2.3 2.2 4.2 Zl,000 otlhet n ndep. s Il e' If in, 156.4 155.9 157.5 156.2 131.4 131.2 132.4 131.3 3 10 17 24 - lats + Addendum 47.5 47.6 47.6 47.6 154.3 154.3 154.7 154.7 June Proxy- + 310.1 111.0 309.4 309.9 288.9 287.8 289.3 290.2 27,710 26,876 26,754 o dit Euro-d 196.0 197.2 197.5 198.2 198.8 28,101 27,652 27,702 27,424 28 .481 27 .696 27 ,965 27 ,504 deposit adjusted Cr 159.9 157.8 156.6 155.4 154.5 203.9 203.5 205.1 203.8 6 13 20 27 Aug. Moy S Supported by Required Reserves S_ TTot May July Member Bank Deposits Reserve Aggrege AggreRates 308.0 less cash items in 31 Table 5 SOURCE OF FEDERAL RESERVE CREDIT Retrospective Changes (Dollar amounts in millions of dollars, based on weekly averages of daily figures) Period Total Federall Reserve credlt (Excl. float) vhldl U.S. Government securities otal isg Bills I/ Other Repurchase agreements Year* 1968 (12/27/67 1969 (12/25/68 Weekly. 1970- -Apr. May June - 12/25/68) - 12/31/69) +3,757 +5,539 +1,298 +5.197 +2,143 ( 1 8 15 22 29 71) 6 13 20 27 Aug. 3 10 17 )) - ) ) ) 42 ) -- 71)) -) 145) 1 8 15 22 29 145) -) -) 29) 42) 5 12 1/ Figures in p renthesis reflect reserve effect ol mat(lh p - Preliminary. --- --- 24 July +1,176 + 707 +4,279 ( 71) -= al e-purchase ) agreement. Federal Agency Securities Bankers' acceptances S 21 S 52 + 206 + 35 + + + 225 182 214 + 18 8 - 134 + - 32 28 + 108 + 16 + - S 36 202 + - 138 138 + + 71 15 - 86 + - 632 444 188 + + 247 196 6 S 38 + 19 23 + 2 14 Member banks borrowings + + 514 245
@FedFRASER