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Meeting of Federal Open Market Committee
March 21, 1972
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, March 21, 1972, at
9:30 a.m.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Burns, Chairman
Hayes, Vice Chairman
Brimmer
Coldwell
Daane
Eastburn
MacLaury
Maisel
Mitchell
Robertson
Sheehan
Winn
Messrs. Francis, Heflin, Mayo, and Swan,
Alternate Members of the Federal Open
Market Committee
Messrs. Morris, Kimbrel, and Clay, Presidents
of the Federal Reserve Banks of Boston,
Atlanta, and Kansas City, respectively
Mr. Holland, Secretary
Mr. Broida, Deputy Secretary
Messrs. Altmann, Bernard, and Molony,
Assistant Secretaries
Mr. Hackley, General Counsel
Mr. Partee, Senior Economist
Mr. Axilrod, Economist (Domestic Finance)
Mr. Solomon, Economist (International Finance)
Messrs. Boehne, Bryant, Gramley, Green,
Hersey, Hocter, Kareken, and Link,
Associate Economists
Mr. Holmes, Manager, System Open Market Account
Mr. Coombs, Special Manager, System Open Market
Account
3/21/72
Mr. O'Connell, General Counsel, Board of
Governors
Messrs. Keir, Pierce, Wernick, and
Williams, Advisers, Division of
Research and Statistics, Board of
Governors
Mr. Wendel, Chief, Government Finance
Section, Division of Research and
Statistics, Board of Governors
Miss Eaton, Open Market Secretariat
Assistant, Office of the Secretary,
Board of Governors
Messrs. Eisenmenger, Parthemos, Taylor,
Scheld, Andersen, and Tow, Senior Vice
Presidents, Federal Reserve Banks of
Boston, Richmond, Atlanta, Chicago,
St. Louis, and Kansas City, respectively
Mr. Debs, Vice President, Federal Reserve
Bank of New York
Mr. Lynn, Director of Research, Federal
Reserve Bank of San Francisco
Mr. Cooper, Assistant Vice President,
Federal Reserve Bank of New York
The Secretary reported
that advices had been received of
the election by the Federal Reserve Banks of members and alternate
members of the Federal Open Market Committee for the term of one
year beginning March 1,
1972; that it
appeared that such persons
were legally qualified to serve; and that they had executed their
oaths of office.
The elected members and alternates were as follows:
Alfred Hayes, President of the Federal Reserve Bank of
New York, with William F. Treiber, First Vice President
of the Federal Reserve Bank of New York, as alternate;
David P. Eastburn, President of the Federal Reserve Bank
of Philadelphia, with Aubrey N. Heflin, President of
the Federal Reserve Bank of Richmond, as alternate;
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3/21/72
Willis J. Winn, President of the Federal Reserve Bank of
Cleveland, with Robert P. Mayo, President of the
Federal Reserve Bank of Chicago, as alternate;
Bruce K. MacLaury, President of the Federal Reserve Bank
of Minneapolis, with Eliot J. Swan, President of the
Federal Reserve Bank of San Francisco, as alternate;
Philip E. Coldwell, President of the Federal Reserve Bank
of Dallas, with Darryl R. Francis, President of the
Federal Reserve Bank of St. Louis, as alternate.
By unanimous vote, the following officers of the Federal
Open Market Committee were elected to serve until the election of
their successors at the first meeting of the Committee after
February 28, 1973, with the understandings (1) that in the event
of the discontinuance of their official connection with the Board
of Governors or with a Federal Reserve Bank, as the case might be,
they would cease to have any official connection with the Federal
Open Market Committee; and (2) that insofar as the titles of the
positions to which they were elected differed from those hereto
fore specified in the Committee's By-Laws and Rules of Organization,
conforming changes were to be made in those documents:
Arthur F. Burns
Alfred Hayes
Robert C. Holland
Arthur L. Broida
Murray Altmann,
Normand R.V. Bernard,
and Charles Molony
Howard H. Hackley
David B. Hexter
J. Charles Partee
Stephen H. Axilrod
Robert Solomon
Chairman
Vice Chairman
Secretary
Deputy Secretary
Assistant Secretaries
General Counsel
Assistant General Counsel
Senior Economist
Economist (Domestic Finance)
Economist (International
Finance)
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3/21/72
Edward G. Boehne, Ralph C.
Bryant, Lyle E. Gramley,
Ralph T. Green, A.B. Hersey,
William J. Hocter, John H.
Kareken, and Robert G. Link
Associate Economists
Secretary's Note:
In consequence of the
foregoing action, the opening sentences of
Sections 2, 3, and 6 of Article II of the
Committee's By-Laws, and the first sentence
of Section 3 of the Committee's Rules of
Organization, were amended to read as follows:
By-Laws:
*
*
*
ARTICLE II. OFFICERS
Section 2. Secretary and Deputy and Assistant
Secretaries - At its first meeting on or after March 1
of each year, the Committee shall elect a Secretary
and one or more Deputy and Assistant Secretaries to
serve until the first meeting on or after March 1 of
the next year. . .
Section 3. Economists - At its first meeting on
or after March 1 of each year, the Committee shall
elect one or more Economists to serve until the first
meeting on or after March 1 of the next year. The
Committee shall also from time to time, as it may decide,
designate one or more of its elected Economists as
Senior or Associate Economists, or otherwise qualify
their titles. The Economists shall prepare for the
use of the Committee and present to it such informa
tion about business and credit conditions as will
assist the Committee in the determination of open
market policies, and shall perform such other duties
as the Committee may require.
*
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3/21/72
Section 6. Filling Vacancies - At any meeting the
Committee may fill any vacancy in the offices described
in this Article.
Rules of Organization:
SECTION 3 -
PERSONNEL
(a) Official Staff.-The official staff of the Federal
Open Market Committee includes its Secretary, Deputy
Secretary, and Assistant Secretaries, General Counsel and
Assistant General Counsel, and Senior Economist, Economists,
and Associate Economists, who perform the duties indicated
by their titles . . .
By unanimous vote, the Federal Reserve Bank of New York was
selected to execute transactions for the System Open Market Account
until the adjournment of the first meeting of the Federal Open Market
Committee after February 28, 1973.
By unanimous vote, Alan R. Holmes and Charles A. Coombs
were selected to serve at the pleasure of the Federal Open Market
Committee as Manager of the System Open Market Account and as
Special Manager for foreign currency operations for such Account,
respectively, it being understood that their selection was subject
to their being satisfactory to the Directors of the Federal Reserve
Bank of New York.
Secretary's Note: Advice subsequently
was received that Messrs. Holmes and
Coombs were satisfactory to the Board of
Directors of the Federal Reserve Bank of
New York for service in the respective
capacities indicated.
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3/21/72
By unanimous vote, the action of Committee members on
February 29, 1972, increasing from $2 billion to $3 billion the
limit on changes between Committee meetings in System Account
holdings of U.S. Government and Federal agency securities specified
in paragraph 1(a) of the continuing authority directive, was ratified.
By unanimous vote, the limit on changes between Committee
meetings in System Account holdings of U.S. Government and Federal
agency securities specified in paragraph 1(a) of the continuing
authority directive was reduced from $3 billion to $2 billion.
By unanimous vote, the action of Committee members on
March 7, 1972, suspending until close of business on March 21,
1972, the lower limit on repurchase agreement rates specified in
1/
paragraph 1(c) of continuing authority directive, was ratified.
By unanimous vote, the minutes of actions taken at the
meeting of the Federal Open Market Committee on January 11, 1972,
were approved.
The memoranda of discussion for the meetings of the Federal
Open Market Committee on January 11 and February 14, 1972, were
accepted.
By unanimous vote, the System open market transactions in
foreign currencies during the period February 15 through March 20,
1972, were approved, ratified, and confirmed.
1/ Messrs. Brimmer and Robertson dissented from the March 7
action. Having so recorded their positions they did not consider
it necessary to dissent also from the ratification.
3/21/72
By unanimous vote, renewal for further periods of three
months of the four System drawings on the National Bank of Belgium
maturing in the period April 4-28, 1972, was authorized.
It was agreed that a subcommittee, consisting of the
Chairman and Vice Chairman of the Committee and the Vice
Chairman of the Board of Governors, or designated alternates,
should be authorized to act on behalf of the Committee with
respect to the manner of effectuating the revaluation clause
in the System's swap contract with the National Bank of Belgium.
By unanimous vote, the open market transactions in
Government securities, agency obligations, and bankers' accept
ances during the period February 15 through March 20, 1972,
were approved, ratified, and confirmed.
By unanimous vote, 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 current economic policy directive:
The information reviewed at this meeting
suggests that real output of goods and services
is increasing in the current quarter at about the
stepped-up rate attained in the fourth quarter of
1971. Several measures of business activity have
strengthened recently and demands for labor have
improved somewhat, but the unemployment rate
remains high. Wholesale prices continued to rise
rapidly in January and February, in part because
3/21/72
of large increases in prices of foods. However, the
advance in wage rates slowed markedly after the post
freeze surge in December. Following a period of slug
gish growth, the narrowly defined money stock increased
sharply in February, partly reflecting a substantial
reduction in U.S. Government deposits. Inflows of time
and savings funds at bank and nonbank thrift institutions
continued rapid in February, although below January's
extraordinary pace. Short-term interest rates have
risen considerably in recent weeks while yields on
long-term securities have changed little on balance.
Exchange rates for most major foreign currencies
against the dollar appreciated further in February and
early March, as recurrent speculative outflows of
capital added to the U.S. balance of payments deficit.
In light of the foregoing developments, it is the
policy of the Federal Open Market Committee to foster
financial conditions conducive to sustainable real
economic growth and increased employment, abatement
of inflationary pressures, and attainment of reason
able equilibrium in the country's balance of payments.
To implement this policy, while taking account of
international developments and possible Treasury
financing, the Committee seeks to achieve bank reserve
and money market conditions that will support moderate
growth in monetary aggregates over the months ahead.
It was agreed that the authorization for the lending of
Government securities from the System Open Market Account should
be retained at this time.
Consideration was then given to the continuing authori
zations of the Committee, according to the customary practice of
reviewing such matters at the first meeting in March of every year.
Secretary's Note: It had been agreed at
the meeting on March 10, 1970, that certain
authorizations among those that the Commit
tee had reviewed annually in the past would
remain effective until otherwise directed
by the Committee, and would no longer be
submitted routinely for review each year.
Instead, it was understood that these
authorizations would be called to the
3/21/72
Committee's attention before the first
meeting in March of each year and that
members would be given an opportunity to
raise any questions they had concerning
them. Accordingly, copies of the autho
rizations in question (listed below) had
been distributed to the Committee on
February 28, 1972, with a request that
members advise the Secretariat if they
wished to have any placed on the agenda
for consideration at today's meeting. No
such requests were received.
The authorizations in question were as follows:
1.
2.
3.
4.
5.
Procedure for allocations of securities in the System
Open Market Account.
for periodic reports prepared by the
Distribution list
Federal Reserve Bank of New York.
Authority for the Chairman to appoint a Federal Reserve
Bank as agent to operate the System Account in case
the New York Bank was unable to function.
Resolutions providing for continued operation of the
Committee, and for certain actions by the Reserve
Banks, during an emergency.
Resolution relating to examinations of the System
Open Market Account.
It
was agreed to retain the existing procedure for making
minutes and other records of the Committee available to employees
of the
Board of Governors and the Federal Reserve Banks, including
authorization to the Secretary to act on the Chairman's behalf in
considering proposals for the addition of members of the Board's
staff to the list
of those having access to Committee minutes and
other records.
By unanimous vote, the continuing authority directive to
the Federal Reserve Bank of New York with respect to domestic open
market operations, as shown below, was reaffirmed;
3/21/72
-10CONTINUING AUTHORITY DIRECTIVE WITH RESPECT TO
DOMESTIC OPEN MARKET OPERATIONS
1. The Federal Open Market Committee authorizes and
directs the Federal Reserve Bank of New York, to the extent
necessary to carry out the most recent current economic
policy directive adopted at a meeting of the Committee:
(a) To buy or sell U.S. Government securities
and securities that are direct obligations of, or
fully guaranteed as to principal and interest by,
any agency of the United States in the open market,
from or to securities dealers and foreign and inter
national accounts maintained at the Federal Reserve
Bank of New York, on a cash, regular, or deferred
delivery basis, for the System Open Market Account
at market prices and, for such Account, to exchange
maturing U.S. Government and Federal agency securities
with the Treasury or the individual agencies or to
allow them to mature without replacement; provided
that the aggregate amount of U.S. Government and
Federal agency securities held in such Account at the
close of business on the day of a meeting of the Com
mittee at which action is taken with respect to a
current economic policy directive shall not be increased
or decreased by more than $2.0 billion during the period
commencing with the opening of business on the day fol
lowing such meeting and ending with the close of busi
ness on the day of the next such meeting;
(b) To buy or sell prime bankers' acceptances of
the kinds designated in the Regulation of the Federal
Open Market Committee in the open market, from or to
acceptance dealers and foreign accounts maintained at
the Federal Reserve Bank of New York, on a cash, regu
lar, or deferred delivery basis, for the account of
the Federal Reserve Bank of New York at market dis
count rates; provided that the aggregate amount of
bankers' acceptances held at any one time shall not
exceed (1) $125 million or (2) 10 per cent of the
total of bankers' acceptances outstanding as shown in
the most recent acceptance survey conducted by the
Federal Reserve Bank of New York, whichever is the
lower;
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-11(c) To buy U.S. Government securities, obligations
that are direct obligations of, or fully guaranteed as
to principal and interest by, any agency of the United
States, and prime bankers' acceptances with maturities
of 6 months or less at the time of purchase, from non
bank dealers for the account of the Federal Reserve
Bank of New York under agreements for repurchase of
such securities, obligations, or acceptances in 15
calendar days or less, at rates not less than (1) the
discount rate of the Federal Reserve Bank of New York
at the time such agreement is entered into, or (2) the
average issuing rate on the most recent issue of 3
month Treasury bills,
whichever is the lower; provided
that in the event Government securities or agency issues
covered by any such agreement are not repurchased by
the dealer pursuant to the agreement or a renewal thereof,
they shall be sold in the market or transferred to the
System Open Market Account; and provided further that
in the event bankers' acceptances covered by any such
agreement are not repurchased by the seller, they shall
continue to be held by the Federal Reserve Bank or shall
be sold in the open market.
2.
The Federal Open Market Committee authorizes and
directs the Federal Reserve Bank of New York or, if the
New York Reserve Bank is closed, any other Federal Reserve
own
Bank, to purchase directly from the Treasury for its
account (with discretion, in cases where it seems desirable,
to issue participations to one or more Federal Reserve
Banks) such amounts of special short-term certificates of
indebtedness as may be necessary from time to time for the
temporary accommodation of the Treasury; provided that the
rate charged on such certificates shall be a rate 1/4 of
1 per cent below the discount rate of the Federal Reserve
Bank of New York at the time of such purchases, and pro
vided further that the total amount of such certificates
held at any one time by the Federal Reserve Banks shall
not exceed $1 billion.
3. In order to insure the effective conduct of open
market operations, the Federal Open Market Committee
authorizes and directs the Federal Reserve Banks to
lend U.S. Government securities held in the System
Open Market Account to Government securities dealers
and to banks participating in Government securities
clearing arrangements conducted through a Federal
Reserve Bank, under such instructions as the Committee
may specify from time to time.
3/21/72
-12By unanimous vote, the authorization for System foreign
currency operations, as shown below, was reaffirmed:
AUTHORIZATION FOR SYSTEM FOREIGN CURRENCY OPERATIONS
1.
The Federal Open Market Committee authorizes and
directs the Federal Reserve Bank of New York, for System
Open Market Account, to the extent necessary to carry out
the Committee's foreign currency directive and express
authorizations by the Committee pursuant thereto:
A. To purchase and sell the following foreign
currencies in the form of cable transfers through spot
or forward transactions on the open market at home and
abroad, including transactions with the U.S. Stabilization
Fund established by Section 10 of the Gold Reserve Act
of 1934, with foreign monetary authorities, and with the
Bank for International Settlements:
Austrian schillings
Belgian francs
Canadian dollars
Danish kroner
Pounds sterling
French francs
German marks
Italian lire
Japanese yen
Mexican pesos
Netherlands guilders
Norwegian kroner
Swedish kronor
Swiss francs
B. To hold foreign currencies listed in paragraph
A above, up to the following limits:
(1) Currencies purchased spot, including
currencies purchased from the Stabliization Fund,
and sold forward to the Stabilization Fund, up to
$1 billion equivalent;
(2) Currencies purchased spot or forward,
up to the amounts necessary to fulfill other forward
commitments;
3/21/72
-13(3) Additional currencies purchased spot or
forward, up to the amount necessary for System opera
tions to exert a market influence but not exceeding
$250 million equivalent; and
(4) Sterling purchased on a covered or
guaranteed basis in terms of the dollar, under agree
ment with the Bank of England, up to $200 million
equivalent.
C. To have outstanding forward commitments under
taken under paragraph A above to deliver foreign currencies,
up to the following limits:
(1) Commitments to deliver foreign currencies
to the Stabilization Fund, up to the limit specified
in paragraph 1B(1) above; and
(2) Other forward commitments to deliver
foreign currencies, up to $550 million equivalent.
D. To draw foreign currencies and to permit foreign
banks to draw dollars under the reciprocal currency arrange
ments listed in paragraph 2 below, provided that drawings by
either party to any such arrangement shall be fully liquidated
within 12 months after any amount outstanding at that time
was first drawn, unless the Committee, because of exceptional
circumstances, specifically authorizes a delay.
2. The Federal Open Market Committee directs the Federal
Reserve Bank of New York to maintain reciprocal currency
arrangements ("swap" arrangements) for System Open Market
Account for periods up to a maximum of 12 months with the
following foreign banks, which are among those designated
by the Board of Governors of the Federal Reserve System
under Section 214.5 of Regulation N, Relations with Foreign
Banks and Bankers, and with the approval of the Committee
to renew such arrangements on maturity:
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3/21/72
Foreign bank
Austrian National Bank
National Bank of Belgium
Bank of Canada
National Bank of Denmark
Bank of England
Bank of France
German Federal Bank
Bank of Italy
Bank of Japan
Bank of Mexico
Netherlands Bank
Bank of Norway
Bank of Sweden
Swiss National Bank
Bank for International Settlements:
Dollars against Swiss francs
Dollars against authorized European
currencies other than Swiss francs
Amount of
arrangement
(millions of
dollars equivalent)
200
600
1,000
200
2,000
1,000
1,000
1,250
1,000
130
300
200
250
1,000
600
1,000
3. Currencies to be used for liquidation of System
swap commitments may be purchased from the foreign central
bank drawn on, at the same exchange rate as that employed
in the drawing to be liquidated. Apart from any such pur
chases at the rate of the drawing, all transactions in
foreign currencies undertaken under paragraph 1(A) above
shall, unless otherwise expressly authorized by the Com
mittee, be at prevailing market rates and no attempt shall
be made to establish rates that appear to be out of line
with underlying market forces.
4. It shall be the practice to arrange with foreign
central banks for the coordination of foreign currency
transactions. In making operating arrangements with
foreign central banks on System holdings of foreign cur
rencies, the Federal Reserve Bank of New York shall not
commit itself to maintain any specific balance, unless
authorized by the Federal Open Market Committee. Any
agreements or understandings concerning the administration
of the accounts maintained by the Federal Reserve Bank of
New York with the foreign banks designated by the Board
of Governors under Section 214.5 of Regulation N shall be
referred for review and approval to the Committee.
3/21/72
-15-
5. Foreign currency holdings shall be invested insofar
as practicable, considering needs for minimum working bal
ances. Such investments shall be in accordance with Sec
tion 14(e) of the Federal Reserve Act.
6. A Subcommittee consisting of the Chairman and the
Vice Chairman of the Committee and the Vice Chairman of
the Board of Governors (or in the absence of the Chairman
or of the Vice Chairman of the Board of Governors the
members of the Board designated by the Chairman as alter
nates, and in the absence of the Vice Chairman of the
Committee his alternate) is authorized to act on behalf
of the Committee when it is necessary to enable the Federal
Reserve Bank of New York to engage in foreign currency
operations before the Committee can be consulted. All
actions taken by the Subcommittee under this paragraph
shall be reported promptly to the Committee.
7. The Chairman (and in his absence the Vice Chairman
of the Committee, and in the absence of both, the Vice
Chairman of the Board of Governors) is authorized:
A. With the approval of the Committee, to enter
into any needed agreement or understanding with the Sec
retary of the Treasury about the division of responsibility
for foreign currency operations between the System and
the Secretary;
B. To keep the Secretary of the Treasury fully
advised concerning System foreign currency operations,
and to consult with the Secretary on such policy matters
as may relate to the Secretary's responsibilities; and
C. From time to time, to transmit appropriate
reports and information to the National Advisory Council
on International Monetary and Financial Policies.
8. Staff officers of the Committee are authorized to
transmit pertinent information on System foreign currency
operations to appropriate officials of the Treasury Depart
ment.
9. All Federal Reserve Banks shall participate in the
foreign currency operations for System Account in accord
ance with paragraph 3 G(1) of the Board of Governors'
Statement of Procedure with Respect to Foreign Relation
ships of Federal Reserve Banks dated January 1, 1944.
-16-
3/21/72
10. The Special Manager of the System Open Market Account
for foreign currency operations shall keep the Committee
informed on conditions in foreign exchange markets and on
transactions he has made and shall render such reports as
the Committee may specify.
By unanimous vote,
the foreign currency directive,
as shown
below, was reaffirmed:
FOREIGN CURRENCY DIRECTIVE
1. The basic purposes of System operations in foreign
currencies are:
A. To help safeguard the value of the dollar in
international exchange markets;
B. To aid in making the system of international
payments more efficient;
C. To further monetary cooperation with central
banks of other countries having convertible currencies,
with the International Monetary Fund, and with other inter
national payments institutions;
D. To help insure that market movements in exchange
rates, within the limits stated in the International Monetary
Fund Agreement or established by central bank practices,
reflect the interaction of underlying economic forces and
thus serve as efficient guides to current financial decisions,
private and public; and
E. To facilitate growth in international liquidity
in accordance with the needs of an expanding world economy.
2.
Unless otherwise expressly authorized by the Federal
Open Market Committee, System operations in foreign currencies
shall be undertaken only when necessary:
A. To cushion or moderate fluctuations in the flows
of international payments, if such fluctuations (1) are
deemed to reflect transitional market unsettlement or other
temporary forces and therefore are expected to be reversed
in the foreseeable future; and (2) are deemed to be dis
equilibrating or otherwise to have potentially destabilizing
3/21/72
-17-
effects on U.S. or foreign official reserves or on exchange
markets, for example, by occasioning market anxieties, un
desirable speculative activity, or excessive leads and
lags in international payments;
B. To temper and smooth out abrupt changes in
spot exchange rates, and to moderate forward premiums and
discounts judged to be disequilibrating. Whenever supply
or demand persists in influencing exchange rates in one
direction, System transactions should be modified or
curtailed unless upon review and reassessment of the sit
uation the Committee directs otherwise;
C. To aid in avoiding disorderly conditions in
exchange markets. Special factors that might make for
exchange market instabilities include (1) responses to
short-run increases in international political tension,
(2) differences in phasing of international economic
activity that give rise to unusually large interest rate
differentials between major markets, and (3) market rumors
of a character likely to stimulate speculative transactions.
Whenever exchange market instability threatens to produce
disorderly conditions, System transactions may be under
taken if the Special Manager reaches a judgment that they
may help to reestablish supply and demand balance at a
level more consistent with the prevailing flow of under
lying payments. In such cases, the Special Manager shall
consult as soon as practicable with the Committee or, in
an emergency, with the members of the Subcommittee designated
for that purpose in paragraph 6 of the Authorization for
System foreign currency operations; and
D. To adjust System balances within the limits
established in the Authorization for System foreign cur
rency operations in light of probable future needs for
currencies.
3. System drawings under the swap arrangements are
appropriate when necessary to obtain foreign currencies
for the purposes stated in paragraph 2 above.
4. Unless otherwise expressly authorized by the Com
mittee, transactions in forward exchange, either outright
or in conjunction with spot transactions, may be under
taken only (i) to prevent forward premiums or discounts
from giving rise to disequilibrating movements of short
term funds; (ii) to minimize speculative disturbances;
-18-
3/21/72
(iii) to supplement existing market supplies of forward
cover, directly or indirectly, as a means of encouraging
the retention or accumulation of dollar holdings by private
foreign holders; (iv) to allow greater flexibility in
covering System or Treasury commitments, including com
mitments under swap arrangements, and to facilitate opera
tions of the Stabilization Fund; (v) to facilitate the use
of one currency for the settlement of System or Treasury
commitments denominated in other currencies; and (vi) to
provide cover for System holdings of foreign currencies.
It was agreed that the next meeting of the Federal Open
Market Committee would be held on Tuesday, April 18, 1972, at
9:30 a.m.
The meeting adjourned.
Secretary
@FedFRASER