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Strictly Confidential (FR) Class I FOMC November 16, 1979 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) CLASS I - FOMC November 16, 1979 MONETARY AGGREGATES AND MONEY MARKET CONDITIONS Recent developments (1) Growth rates for the monetary aggregates during the fourth quarter of 1979 consistent with the decision by the FOMC at its meeting on October 6 are shown in the first and second columns of the table below. Such growth rates, if attained, would keep expansion in the aggregates over the year from QIV '78 to QIV '79 within the Committee's desired longer-run ranges, as shown in columns three and four of the table. The fourth quarter growth rates, in combination with growth over the first nine months of the year (shown in column five), would imply rates of expansion for M-1 and M-3 in the upper halves of their longer-run growth ranges, and for M-2 at the top of its range. QIV '79 Target Growth Rates Consistent with FOMC Decision on Oct. 6, 1979 Quarterly Sept. Averages to Dec. QIV '78 to QIV '79 Period Implied Target Growth Ranges Rates Addendum: Growth Rates from QIV '78 to QIII '79 (1) (2) (3) (4) (5) M-1 4.5 6.1 5.3 3 to 6 1/ 5.0 M-2 7.6 8.9 8.0 5 to 8 7.5 M-3 7.4 8.4 8.1 6 to 9 7.8 1/ Represents the original 1½ to 4½ percent range specified by the FOMC, adjusted upward by staff's estimate that ATS effects will reduce measured M-1 growth by about 1½ percentage points over the longer-run policy period rather than the 3 percentage points originally estimated in February. (2) The growth rates from September to December in the family of reserve aggregates needed to attain the Committee's monetary aggregate objectives were estimated by the staff immediately following the FOMC's October 6 meeting and took account of the Committee's decision to "bias" the paths, especially for nonborrowed reserves, toward an immediate tightening of the money market. These estimates assumed: (a) an increase in M-1, seasonally adjusted,at a steady rate month-by-month (a pattern of money supply that was roughly consistent with our projected pattern of money demand); (b) continuation of the recent patterns of deposit mix; (c) excess reserves averaging $200 million; and (d) for purposes of deriving the non- borrowed path, an increase in the initially contemplated average level of member bank borrowings to $1.5 billion from the September average of $1.3 billion. Of course, the actual level of borrowing and money market conditions would depend on the demand for reserves relative to the nonborrowed reserves supplied through the open market desk. (3) As shown in the table below, growth rates in the monetary aggregates, and in the family of reserve measures, since September have generally decelerated from the pace of the preceding three months.1/ Non- borrowed reserves increased by about a 2¼ percent annual rate from September to the first half of November, slower than the pace given by the fourth quarter path. 1/ On the other hand, total reserves expanded at about an Data are expressed as annual rates of growth. This, it should be recognized, particularly exaggerates swings in the reserve series where relatively modest changes in borrowings, excess reserves, or deposit mix can lead to large percentage changes in nonborrowed or total reserves because the level of the series is relatively small. 11-1/2 percent annual rate over this period, a bit above path. At the same time, growth in M-2 has been about equal to path, while growth in M-1 has 1/ been running low. Expansion in the broader aggregates has been almost wholly dependent on growth in money market certificates and large CD's, as the outstanding amount of savings deposits at banks and thrift institutions declined sharply in the wake of the run-up of interest rates. (The charts on the next two pages place the recent growth in the monetary aggregates and bank credit in longer-run perspective.) Actual June to Sept. Targeted Sept. to Dec. Recent Periods Sept. Sept. to to First Half Oct. of Nov. Monetary Aggregates M-1 9.5 4.5 2.5 0.9 M-2 12.2 7.6 8.6 7.5 M-3 10.8 7.4 7.5 n.a. Monetary Base 12.5 8.0 10.6 7.9 Total Reserves 10.6 7.0 20.7 Nonborrowed Reserves 11.7 5.7 1.1 Reserve Measures 11.4 2.2 (4) The Committee at its October 6 meeting had contemplated a federal funds rate initially around 13 to 13-1/2 percent, within an 11-1/2 to 15-1/2 percent range, and member bank borrowings around $1-1/2 billion-levels reached (as shown in the table below) in the week ended October 17, the first full statement week after the Committee's decision. 1/ However, over the Somewhat more reserves than expected have been absorbed by shifts in the deposit mix, expansion of net interbank deposits, and increased demand for excess reserves. Chart 1 CONFIDENTIAL (FR) Class II - FOMC 11/16/79 Actual and Targeted M-1 and M-2 M-1 Billions of dollars 385 04 '78-Q4 '79 --- Current Longer-Run Range ....... 42% Growth-Sept. to Dec. -- 380 375 /-3% -370 - - . -365 -360 -355 I ''''~''''''''''1 0 N I D I I F J I I M A I M I J 1978 I J I A I I I 0 S N 1979 M-2 Billions of dollars .". --- Current Longer-Run Range -.. 7 v2% Growth-Sept. to Dec. 950 Q4 '78-Q4 '79 -940 - 930 -920 . .. 5% -. ,- - 910 -900 -890 - - II O N 1978 0 D I N . J ~I F F I M M I I A M M I I J 1979 J J I A A I S S I 0 0 I N N I L D 880 870 Chart 2 CONFIDENTIAL (FRI Class lFOMC 11/16/79 Actual and Targeted M-3 and Bank Credit Billions of dollars 1640 Q4 '78-Q4 '79 Current Longer-Run Range 7%/% Growth-Sept. to Dec. S9% _ .**' % - 1620 1580 1560 1540 1520 1500 1480 1978 1979 Billions of dollars 1150 Current Longer-Run Range -1125 10'A% 1100 7 % % 1075 Q4 '78-Q4 '79 1050 1025 1000 975 0 N 1978 D J F M A A 1979 S 0 first half of October, all aggregate reserve measures were running well above path, partly in consequence of stronger demands for reserves than expected and partly because the Desk adjusted its operations to take account of the unsettled conditions in financial markets. During the second half of the month, Desk operations were directed more firmly at holding nonborrowed reserve growth to path levels, or somewhat below, in view of the continued strength of total reserves. Operations were accompanied by a sharp rise in the federal funds rate and in member bank borrowings. By the last week of October, the average federal funds rate had increased to about 15½ percent and member bank borrowings to around $3 billion. Both the funds rate and member bank borrowing dropped back in the first half of November, to around 13½ percent and $2 billion, respectively, as banks' demand for reserves eased. Average Federal Funds Rate Member Bank Borrowings (Millions of dollars) October 3 10 17 24 31 11.91 12.00 13.22 15.14 15.61 1,119 938 1,530 2,960 3,056 November 7 14 13.77 13.30 1,928 1,858 (5) Short-term market interest rates have risen sharply on balance since the System's October 6 announcement. Treasury bill rates--which have displayed a good deal of volatility in response to shifting pressures in the federal funds market and to unexpected changes in bill supplies--have increased on balance by about 1 to 1-3/8 percentage points. Rates on private short-term instruments have generally posted larger gains--in the 1-3/8 to 1¾ percentage point range. (6) Long-term yields, too, have moved higher since early October. Yields on Treasury bonds show net gains of about one percentage point; those on corporate and municipal bonds registered increases of about 1¼ percentage points and 5/8 percentage points, respectively. The sharp rise in rates,together with the generally turbulent market conditions and the cautious attitudes of underwriters, resulted in the postponement or cancellation by both corporate and municipal borrowers of a comparatively large number of debt offerings, especially by lower-rated borrowers. In its mid-quarter financing the Treasury decided to offer a standard package of issues--a 3½-year note, a 10-year note and a 30-year bond--to raise $1.4 billion of new money and refinance $4.6 billion of maturing debt. Record yields (for given maturities) were set on all three issues. (7) Expansion of both loans and investments at commercial banks slowed substantially in October. Security loans declined sharply, as security holdings by dealers fell in reaction to uncertain market conditions, declining security prices, and sharply rising borrowing costs. Growth in business loans (net of holdings of acceptances) moderated somewhat from the recent rapid pace, while real estate lending remained strong. With demand and savings deposits declining, banks financed loan growth for the most part by issuing.money market certificates and large CD's, offering repurchase agreements, and liquidating bankers (8) acceptances. Conditions in mortgage markets tightened markedly in response not only to the general rise in interest rates, but also to pressures on deposit inflows at thrifts and to problems caused by interest rate ceilings. S&Ls were reported to have sharply curtailed their mortgage commitment activity after October 6. The average interest rate on new commitments at S&Ls rose around 1 percentage points to 12.85 percent, a rate exceeding usury ceilings in 20 states. Secondary market rates also rose rapidly, and the volume of offerings at FNMA auctions surged. (9) The foreign exchange value of the dollar rebounded on average following the October 6 measures, with the weighted average value of the dollar having risen by nearly 3 percent through November 13, just prior to announcements concerning the disposition of official Iranian assets. Improvement over this period was most substantial against the yen, which declined by about 9 percent against the dollar. The dollar rose only 2 percent against the DM. . Most recently, in the wake of the Iranian situation, the value of the dollar has retraced some of its earlier gains. (10) The table on the next page shows seasonally adjusted annual rates of change, in percent, for selected monetary and financial flows over various time periods. Past Past Past 1977 & 1978 Average Twelve Months Oct. '79 over Oct. '78 Six Months Oct. '79 over Apr. '79 Three Months Oct. '79 over July '79 Nonborrowed reserves 5.0 0.2 2.4 5.1 Total reserves 6.0 2.0 7.7 13.3 20.7 Monetary base 8.7 7.6 9.7 12.3 10.6 M-1 (Currency plus demand deposits 1/) 7.6 4.8 7.9 6.9 2.5 M-2 (M-1 plus time deposits at commercial banks other than large CD's) 9.1 7.9 11.0 10.7 8.6 M-3 (M-2 plus deposits at thrift institutions) 10.5 8.1 9.6 9.5 7.5 M-4 (M-2 plus CD's) 10.3 7.4 9.1 12.3 M-5 (M-3 plus CD's) 11.1 7.8 8.6 10.6 9.3 12.3 13.5 12.9 13.8 7.6 Large CD's 1.4 0.2 -0.7 2.1 3.0 Eurodollars Other borrowings 3/ 0.1 1.2 3.0 1.6 4.0 1.9 4.5 2.4 -1.0 2.5 Nonbank commercial paper 0.2 0.8 1.1 0.9 0.3 Past Month Oct. '79 over Sept. '79 1.1 Concepts of Money 11.3 Bank Credit Loans and investments of all commercial banks 2/ Managed Liabilities of Banks (Monthly average change in billions) Memo Other than interbank and U.S. Government. Includes loans sold to affiliates and branches. Primarily Federal funds purchases and securities sold under agreements to repurchase 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 Wednesday statement date 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. 1/ 2/ 3/ Prospective developments (11) At its last meeting, the Committee decided on a target rate of growth in M-1 from September to December on the order of 4 associated with growth in M-2 of about 7½ percent. percent, The Committee also indicated that somewhat slower rates of growth were acceptable. Of the alternatives shown below for Committee consideration, alternative B involves a November-December growth rate for M-1 that achieves a 4½ percent rate of expansion from September to December, but with an accompanying M-2 growth above the Committee's earlier target. Alternative C is based on a lower M-1 growth rate, and includes an M-2 growth closer to, though still above, the Committee's earlier objective. in the aggregates. Alternative A involves more rapid growth Because only six weeks are left before the end of the year, monetary growth rates for the year 1979 may not be substantially affected by alternative policy courses, although these policies would have an immediate influence on credit conditions and on the trajectory of monetary growth entering the new year. (The tables on pp. 9 and 10 show more detailed figures, including growth rates for the year). Alt. A Alt. B Alt. C Annual growth rates for November-December 1/ M-1 6 5½ 4½ M-2 9½ 9 8¼ M-3 8 7½ 7 Federal funds rate range between now and next FOMC meeting (mid-December) 10½ to 15½ 11½ to 15½ 11½ to 16 Implied quarterly growth rates (measured from Sept. to Dec.) M-1 5 4½ 3¾ M-2 M-3 9¼ 8 8¾ 7½ 8¼ 7¼ 1/ For convenience in communication under a reserve operating target, monetary growth rates are expressed as point estimates, rather than a range. Alternative Levels and Growth Rates for Key Monetary Aggregates M-1 M-2 Alt. A Alt. B Alt. C Alt. A 378.6 378.9 382.4 378.6 378.7 381.4 383.3 953.4 944.0 952.5 384.2 378.6 378.8 382.0 383.8 938.6 944.2 1980 October November December January 960.4 959.7 958.6 1978 QIV 361.0 361.0 361.0 873.2 873.2 873.2 1979 QI QII QIII QIV 359.1 365.9 374.8 380.0 359.1 365.9 374.8 379.8 359.1 365.9 877.1 896.0 922.8 877.1 896.0 922.8 945.0 877.1 896.0 922.8 944.6 1979 374.8 379.6 945.4 Alt. B 938.6 Alt. C 938.6 943.7 951.1 Growth Rates Quarterly Average: 1979 QI QII QIII QIV -2.1 7.6 9.7 5.5 -2.1 7.6 9.7 5.3 -2.1 7.6 9.7 5.1 1.8 8.6 12.0 9.8 1.8 8.6 12.0 9.6 1.8 8.6 12.0 9.4 Annual: QIV '78-QIV '79 FOMC Target Growth 5.3 8.3 3 to 61 5 to 8 1/ The staff has assumed that over the longer-run policy period from QIV '78 to QIV '79 M-l growth will be reduced by about 1-1/2 percentage points by ATS. -10Alternative Levels and Growth Rates for Key Monetary Aggregates (cont'd) Bank Credit M-3 Alt. A Alt. B Alt. C Alt. A Alt. B Alt. C 1980 October November December January 1604.4 1612.6 1625.8 1636.4 1604.4 1612.4 1624.6 1635.5 1604.4 1612.0 1623.1 1634.3 1133.6 1141.8 1151.5 1162.0 1133.6 1141.6 1151.0 1161.0 1133.6 1141.4 1150.5 1160.0 1978 QIV 1492.7 1492.7 1492.7 1009.2 1009.2 1009.2 1979 QI QII 1510.3 1540.0 1580.5 1614.3 1510.3 1540.0 1580.5 1613.8 1510.3 1540.0 1580.5 1613.2 1044.2 1073.6 1109.6 1142.3 1044.2 1073.6 1109.6 1142.1 1044.2 1073.6 1109.6 4.7 7.9 10.5 8.6 4.7 7.9 10.5 8.4 4.7 7.9 10.5 8.2 13.7 11.3 13.4 11.8 13.7 11.3 13.4 11.7 13.7 11.3 13.4 11.6 13.2 13.2 13.1 1979 QIII QIV 1141.8 Growth Rates Quarterly Average: 1979 QI QII QIII QIV Annual: QIV '78-QIV '79 FOMC Target Growth 8.1 6 to 9 7 to 10k -11(12) Alternative B involves acceleration in money growth rates over the balance of the year from their recent pace, with M-1 expanding at a 5 percent annual rate on average in November and December and M-2 at a 9 percent rate. Since the latest data suggest that M-1 in mid- November is quite low relative to path, a considerable spurt of M-1 growth in the last half of November and in December is needed to achieve the objective in this alternative. This would probably be reflected mainly in a rapid December growth rate. (13) The staff would expect that expansion in the aggregates as specified under alternative B could be attained by growth (at annual rates) in the family of reserve measures over November and December as follows: monetary base, 7 percent; total reserves,7 percent; and non- borrowed reserves, 15 percent. For purposes of constructing the nonborrowed reserve path, given the current discount rate, member bank borrowings were assumed to average $1 billion, the same initial assumption as adopted by the Committee in early October. (14) The increase in M-1 targeted over the balance of the quarter is consistent with the expected transactions demand for money over the fourth quarter as a whole, given the GNP projections. The federal funds rate under this alternative probably would be around the 13 percent level early in the period and it might go a bit lower as the period progresses. If bearish economic news tends to cumulate, interest rates generally might drop rather substantially and in practice there may also be some sympathetic further downward pressure on the funds rate. But any drop in market rates in general, and concomitant decline in the federal funds rate, would tend to be more sustained and deeper if economic activity and/or demand for money in the fourth quarter were substantially weaker than the staff has projected. On the other hand, of course, a stronger pace of -12economic activity and/or inflation than is being projected would probably be associated with strengthening money demand, stronger bank credit demands, and renewed upward pressures on the funds rate. (15) Bank credit growth is likely to remain near its recent reduced pace over the weeks ahead, with business loan growth at a more moderate pace as inventory growth slows further, with consumer loan growth remaining at a reduced pace in view of already high debt burdens and the extended decline in real personal income, and with real estate loan growth beginning to slack off as housing demand weakens. Bank acquisitions of securities could pick up, however, especially if the market becomes even more convinced that the peak in interest rates for this cycle has been reached. (16) Pressures on thrift institutions are unlikely to ease over the next few weeks under alternative B. However, if the funds rate drops a little, and corporate bond yields do decline, mortgage rates could edge off. A stabilized market atmosphere would make thrift institutions less hesitant to commit funds to the mortgage market. It is not likely, though, that mortgage market conditions will improve markedly unless short-term market rates drop significantly and/or adjustments favorable to thrift institutions are made in deposit ceiling rates. (17) The specifications of alternative C involve slower growth in the monetary aggregates than alternative B, as indicated in the table in paragraph (11). Such growth rates would be consistent with expansion in the monetary base and total reserves over November-December at annual rates of 7 and 6 percent, respectively. Given the expected demand for money, this alternative is likely to be associated with either no change or some rise in market rates. On the assumption that adoption of this -13alternative would mean that the Committee desires greater assurance that growth rates for the aggregates will not be excessive, the upper limit of the proposed funds rate range has been raised slightly from that of alternative B. Consistent with such an approach, the nonborrowed reserve path for this alternative has been constructed on the assumption that borrowings average a shade under $2 billion, implying growth in nonborrowed reserves of around 8¾ percent over November and December--considerably less than the alternative B pace. be around 13 The funds rate initially would probably percent, or a bit higher, given the present discount rate. If the discount rate were raised, in light of a continuing relatively wide gap between the discount and federal funds rates, additional nonborrowed reserves would have to be provided unless the Committee wished to tolerate further upward pressures on market rates--a decision that might depend in part on the behavior at the time of monetary aggregates, total reserves, and the monetary base. (18) Adoption of alternative C would probably lead to some rebound in market interest rates, as expectations that interest rates had already peaked were disappointed. Pressures on thrift institutions would be somewhat more intense than under alternative B, mortgage rates would probably rise a little further, and the bank prime rate would also be under further upward pressure. Any increase of interest rates might be quite modest in magnitude and short-lived, however, if business news were adverse. Nevertheless, the higher rate levels than under alternative B would tend to hold down money demanded in early 1980, implying a decline of interest rates early in the new year if the Committee wishes to provide -14the reserves needed to keep M-1 in the first quarter of next year on the midpoint of its longer-run growth path--assumed for these purposes to be a 6 percent rate of growth.1/ (19) Provision of reserves needed to attain the specifications for the monetary aggregates presented under alternative A would appear to involve an easing in money market conditions. The growth in the monetary base and total reserves over November and December implied by that alternative--at 7¾ and 7½ percent, annual rates, respectively--are only slightly more rapid than under alternative B. However, growth in nonborrowed reserves, at over a 20 percent annual rate, would be considerably more rapid. Such growth is consistent with an initial decline in the funds rate to around 12 percent and a drop in member bank borrowing to around $1 billion or so, given the prevailing 12 percent discount rate. The funds rate range proposed for this alternative is 10½ to 15½ percent, involving a reduction in the lower limit as compared with alternative B. (20) The approach to open market operations of alternative A would exert considerably downward pressure on market interest rates generally as more and more participants came to believe rates had peaked. This decline of interest rates would ease cost pressures on banks and thrift institutions, but would not, given present ceiling rates, substantially increase deposit flows to thrifts, relative to alternative B, even if the funds rate began to approach its 10½ percent alternative A lower limit. 1/ The Committee at its July meeting decided that growth of the aggregates in 1980 would be within the same ranges as for 1979, although with certain qualifications for changing economic conditions and institutional changes. The 1979 range of 1½ to 4½ percent for M-1 assumed that ATS effects would depress M-1 growth by 3 percentage points. It now appears that ATS effects will be negligible in 1980, implying a 4½ to 7½ percent M-1 range, centering on 6 percent. -15(21) The monetary aggregates targeted over the last two months of the year under alternative A would not lead to growth in the monetary aggregates for the year 1979 very much different from that of alternative B, but the lower interest rates associated with this alternative might tend to moderate the expected recession in economic activity and tend to increase the quantity of money demanded in early 1980. A reasonable implication of this alternative, therefore, might be a policy in early 1980 that supplied somewhat more reserves and money than consistent with the assumed 6 percent midpoint of the Committee's longer-term target for 1980. Such a policy early next year would, in turn, imply the need for more constraint on money growth as the year progressed. (22) With regard to effects of monetary policy choices on exchange markets, some decline of interest rates here might lead to downward pressures on the exchange value of the dollar, but such pressures probably would not be significant unless the decline in interest rates were substantial and accompanied by an acceleration of inflation or of the monetary aggregates. A rise of interest rates here may help the dollar on exchange markets, but any tendency for the dollar to rise would be limited to the extent that other countries raised interest rates or moderated, through exchange market intervention, declines in the value of their own currencies. Of course, exchange market developments over the near-term may be most affected by further economic and political developments in the Middle East. -16- Directive language (23) Given below are suggested operational paragraphs for the directive consistent with the form of the directive adopted at the meeting on October 6. It calls for restraining expansion of reserve aggregates to a pace consistent with the desired rates of growth in M-1, M-2, and M-3 in the fourth quarter of 1979, provided that the federal funds rate on a weekly average basis remains within a specified range. The range for the funds rate adopted on October 6 is shown in strike-through form. In the short run, the Committee seeks to restrain expansion of reserve aggregates to a pace consistent with deceleration in growth of M-1, M-2, and M-3 in the fourth quarter of 1979 to rates that would hold growth of these monetary aggregates over the whole period from the fourth quarter of 1978 to the fourth quarter of 1979 within the Committee's longer-run ranges, provided that in the period before the next regular meeting the weekly average federal funds rate remains within a range of [DEL: 15½] to 11½ ____ The percent. [DEL: Committee ____ TO need for the will consider that appears it sypplementary-instructions if operations to maintain would aggregates reserve of restrain expansion federal rate funds IF the near the upper of limit range.] its IT APPEARS DURING THE PERIOD BEFORE THE NEXT MEETING THAT THE CONSTRAINT ON THE FEDERAL FUNDS RATE IS OBJECTIVE FOR THE EXPANSION OF RESERVES, OPERATIONS IS INCONSISTENT WITH THE THE MANAGER FOR DOMESTIC PROMPTLY TO NOTIFY THE CHAIRMAN WHO WILL THEN DECIDE WHETHER THE SITUATION CALLS FOR SUPPLEMENTARY INSTRUCTIONS FROM THE COMMITTEE. Appendix I Implied Velocity Growth Rates Alt. A Alt. B Alt. C QI 12.3 12.3 12.3 QII -1.0 -1.0 -1.0 0.9 1.3 0.9 1.4 0.9 1.6 QI QII 8.3 -2.0 8.3 -2.0 8.3 -2.0 QIII -1.2 -1.2 -1.2 QIV -2.9 -2.8 -2.6 V-I (GNP/M-1) 1979 QIII QIV V-2 (GNP/M-2) 1979 NOV. 16, 1979 Table 1 Money and Credit Aggregate Measures ank Reserves Period Total Nonborrowed Loans and Money Stock Measures Credit Monetary Base Total M-1 M-2 M-l+ M-3 M-4 M-5 M-6 M-7 Investments 2 1 3 - 4 11 1 IATES OF I IRWH 1ROWTH) PER CENT ANNUAL I ANNUALLY: 0.7 5.3 6.7 1976 1977 1978 0.9 3.1 6.8 6.7 8.3 9.1 7.5 11.1 13.5 5.8 12.6 7.9 7.2 9.3 5.4 10.9 9.8 8.4 12.7 11.7 7.6 5.6 7.6 5.7 8.8 9.0 12.5 13.6 8.0 6.1 6.2 4.4 7.7 8.8 -6.1 4.8 12.8 2.7 -0.6 -1.6 10.2 11.7 10.5 9.9 11.5 10.2 9.9 11.6 11.4 8.3 9.9 10.0 10.4 10.0 9.8 11.3 10.8 5.2 6.3 5.5 6.9 9.4 4.7 7.1 7.7 8.7 8.4 10.9 9.3 7.1 10.1 10.4 SEMI-ANNUALLY: 1ST HALF 1978 2ND HALF 1978 1ST HALF 1979 QUARTERLY: -3.9 4TH QTR. 1978 0.7 2.6 7.3 12.7 0.6 1ST QTR. 1979 2ND QTR, 1979 3RD QTR. 1979 QUARTERLY-AV: -4.5 -3.9 10.6 -5.8 -8.3 11.7 4.2 4.7 12.5 13.3 11.9 15.8 -2.4 11.1 9.5 -5.2 7.2 8.0 1.7 11.3 12.2 4.6 9.2 10.8 2.5 4.4 12.4 5.0 5.1 11.0 6.2 6.8 9.8 8.5 9.1 12.7 7.6 9.3 9.3 10.2 9.7 11.1 4.5 3.5 9.3 6.2 4.8 9.0 7.1 6.7 8.5 9.7 8.8 11.2 1978 2.4 4.7 8.5 13.9 4.1 2.7 1ST QTR. 1979 2ND QTR. 1979 3RD QTR. 1979 -3.0 -5.0 6.3 -3.4 -8.8 8.2 5.6 4.0 9.8 :13.7 11.3 13.4 -2.1 7.6 9.7 -5.0 3.7 8.2 1.8 8.6 12.0 4.7 7.9 10.5 5.1 -2.9 0.0 -1.2 14.1 -4.9 8.0 5.9 7.9 14.1 15.4 8.3 1.7 -2.0 2.0 0.8 -4.3 -1.2 6.4 4.8 2.9 8.7 6.7 5.6 5.9 12.9 4.1 8.3 11.6 6.1 7.2 10.0 7.9 8.5 12.7 11.2 5.6 -21.2 2.1 -5.5 -4.7 -1.5 12.7 7.2 11.5 20.7 1.8 -20.9 1.6 8.5 -0.6 12.9 18.7 4.8 3.2 6.2 11.2 12.1 -7.8 -6.8 -1.0 11.4 -2.1 12.3 10.2 6.5 7.2 -4.6 2.9 -3.5 -5.0 -3.7 1.3 17.7 0.7 14.8 10.4 6.8 11.2 2.5 3.8 4.1 -0.4 7.7 -0.5 6.0 11.5 11.5 13.8 11.3 5.6 5.7 3.5 7.0 1.3 7.1 10.6 10.4 11.8 6.5 6.1 6.1 9.2 3.1 8.0 9.5 8.7 11.0 8.4 9.0 8.4 7.9 11.0 5.7 10.4 12.1 11.6 13.8 11.3 4TH QTR. MONTHLY: 1978--OCT. NOV. DEC. 1979--JAN. FEB. MAR. APR. MAY JUNE JULY AUG. SEPT.P OCT. P 1/ 2/ P - -30.3 9.1 20.7 10.0 4.2 1.1 13.9 7.9 13.9 8.8 12.6 13.4 11.6 21.7 10.6 7.6 4.7 BASED ON DATA ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS. BASED ON QUARTERLY AVERAGE DATA. PRELIMINARY I -1.1 2.3 3.8 14.1 5.4 14.2 12.9 11.0 12.2 8.6 4.8 6.2 10.5 4.9 11.9 11.4 10.0 10.9 7.5 .a 9.3 a --- - --- Table 2 NOV. 16, 1979 Money and Credit Aggregate Measures of Seasonally Adjusted, Billions Dollars lank Reserves 1/ Meney Stack Measures k Tot al Period Total _____ borrowed Base and M- 1 n st- __ M-1+ M-2 M 3 M-4 M-5 M-6 M-7 __ ments ANNUALLY 37,242 39,179 41,572 37,189 38r610 40,703 120,801 130,896 142,682 808.1 895.9 1018.1 313.8 338.7 361.2 517.2 560.6 587.2 740.6 809.4 875.8 1235.6 1374.3 1500.1 803.0 883.1 972.4 1298.0 1448.0 1596.7 1436.1 1601.8 1762.6 1483.8 1658.1 1848.0 1978--OCT. NOV. DEC. 41,674 41,573 41,572 40,397 40,870 40,703 141,052 141,749 142,682 998.3 1011.1 1018.1 361.2 360.6 361.2 589.9 587.8 587.2 870.2 873.7 875.8 1484.8 1493.1 1500.1 958.8 969.1 972.4 1573.4 1588.6 1596.7 1736.7 1751.1 1762.6 1811.8 1830.9 1848.0 1979--JAN. FEB. MAR. 41,767 41,028 41,100 40,764 40,055 40,109 143,688 143,619 144,178 1034.5 1045.6 1052.5 359.7 358.6 359.0 583.4 875.0 580.1 579.6 876.7 879.5 1503.7 1509.7 1517.5 975.5 978.8 978.5 1604.2 1611.8 1616.5 1772.1 1781.1 1790.1 1861.8 1874.8 1887.1 APR. MAY JUNE 40,910 40,749 40,697 39,993 38,984 39,279 144,749 145,129 145,877 1064.7 1072.5 1083.8 364.3 364.5 369.0 585.1 584.1 590.1 889.8 893.8 904.4 1530.8 1537.0 1552.3 984.8 1803.8 1808.5 1820.5 1904.4 1913.4 989.3 1625.9 1627.6 1637.2 JULY AUG. SEPT. 41,127 41,375 41,771 39,957 40,290 40,430 147,240 148,725 150,444 1095.9 1106.5 1126.5 372.2 374.3 377.8 595.1 598.3 601.9 914.1 922.5 931.9 1567.0 1580.0 1594.4 998.8 1008.4 1020.0 1651.7 1666.0 1682.4 1834.9 1848.2 1865.1 1949.5 1968.4 1991.1 OCT. 42,492 40,468 151,776 1133.6 378.6 599.6 938.6 1604.4 1029.6 1695.5 1878.2 2009.8 1979-SEPT. 19 26 41,830 42,041 40,068 40,882 150,303 150,702 377.3 377.7 601.6 600.8 931.6 932.8 1019.9 1021.8 OCT. 3P o0P 17P 24P 31P 42,177 42,324 42,530 42,063 43,185 41,058 41,386 41,000 39,103 40,129 151,375 151,539 151,751 151,208 152,794 379.7 380.5 378.7 376.9 376.2 602.4 603.2 600.5 597.1 594.6 936.7 939.6 938.7 937.1 937.8 1025.9 1029.5 1029.7 1029.0 1030.3 NOV. 7P 14P 42,635 42,272 40,707 40,415 152,390 151,953 379.2 377.4 595.2 592.4 942.2 941.9 1036.1 1976 1977 1978 MONTHLY: 984.4 1930.0 WEEKLY:. & 1036.1 1 _ h~ A I .1A. NOTES MEEKLY DATA ARE DAILY AVERAGES FOR STATEMENT WEEKS. MONTHLY DATA ARE DAILY AVERAGES. WEEKL Y OATA ARE M3, MS, M6, NT, TOTAL LOANS AND INVESTMENTS AND THRIFT INSTITUTION DEPOSITS. 1/ BASED ON DATA ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS. DATA SHOWN IN MILLIONS OF DOLLARS. P - PRELIMINARY __ _ _ _ NOT AVAILABLE FOR NOV. 16, Table 3 1979 Components of Money Stock and Related Measure Currncy 1 Priod Demand Dmand 2 Total 4 5 6 Other Private Short Term Savings U.S.Gov't Short-term BondsSecurities Assets U 1/ Mutual Time and Savings Deposits OSavings Other Than CDs T ToaDeposits l |CDs h Other Savings Total Bank & Sa& Shares . 7 8 Credit Union Shares 9 10 11 12 (Per cent annual rates of growth) ANNUALLY -23.3 12.8 32.8 15.4 14.0 10.2 17.8 19.5 15.0 6.9 6.6 5.4 7.1 12.6 8.9 12.1 13.5 46.7 11.7 18.4 42.6 19.0 8.5 11.5 17.0 12.0 6.3 4.3 12.5 4.9 50.9 33.9 -6.3 17.4 -7.1 8.2 4.5 0.7 39.5 62.2 7.7 4.0 6.2 69.3 1.5 9.8 19.8 0.0 0.0 0.5 36.1 54.9 41.7 51.5 -2.7 60.3 9.5 9.3 10.0 4.6 7.4 6.1 8.1 11.4 12.4 15.0 11.2 9.4 25.0 11.1 2.2 1ST HALF 1978 2ND HALF 1978 9.3 10.2 7.6 4.5 12.2 12.0 7.6 10.7 2.9 1.5 1ST HALF 1979 8.7 0.6 4.8 6.9 7.7 1976 1977 1978 7.5 11.4 15.6 SEMI-ANNUALLY: QUARTERLY: -2.7 1ST QTR. 1979 2ND QTR. 1979 3RD QTR. 1979 -5.3 18.1 36.6 5.4 0.5 14.1 4.6 11.5 14.0 -9.5 0.2 5.3 15.6 19.4 19.9 9.9 -57.0 15.1 1.7 7.8 8.5 13.4 11.9 -6.4 12.3 8.2 9.7 4TH QTR. 1978 12.3 10.2 0.2 18.2 25.0 11.8 10.1 4.0 7.3 44.4 29.9 -41.0 -17.7 9.6 6.7 7.5 0.8 8.3 19.3 1.5 0.0 0.0 29.2 46.4 8.0 66.9 49.2 58.3 12.5 9.8 9.5 9.2 4.6 9.1 4.5 3.0 4.5 -11.4 -14.4 45.3 41.3 1.5 -1.5 0.0 0.0 0.0 0.0 0.0 0.0 1.5 1.5 28.1 19.2 58.2 55.5 38.2 27.5 -1.2 -11.7 4.7 -1.2 61.9 53.5 42.3 44.5 50.1 53.8 55.9 10.7 9.5 5.9 8.0 QUARTERLY-AV: 4TH QTR. 1978 10.6 1ST QTR. 1979 2ND QTR. 1979 3RD QTR. 1979 9.1 8.1 11.1 -6.2 7.5 9.2 1978--OCT. NOV. DEC. 7.6 10.0 11.2 -0.9 -5.9 1979--JAN. FEB. MAR. APR. MAY JUNE JULY AUG. SEPT.P OCT. P 8.6 8.6 6.1 9.7 6.0 9.5 10.6 14.1 15.1 4.6 8.4 1.2 9.0 4.5 9.3 13.6 -9.6 -3.1 5.5 15.6 18.5 19.2 -1.4 8.5 21.7 5.3 10.0 9.4 3.5 -0.5 -8.5 -7.0 18.5 23.7 11.2 1.4 92.1 15.1 -10.0 -8.3 -0.9 21.3 -1.4 16.8 10.3 4.0 10.2 0.9 9.0 8.6 -1.4 2.1 -1.4 0.8' 12.2 14.6 15.1 16.6 1.6 6.5 5.6 11.8 8.7 13.6 14.8 13.7 12.9 12.8 -11.8 -12.0 -4.9 0.0 -7.2 7.8 9.4 6.6 0.0 12.8 20.0 13.6 19.8 19.9 17.6 18.1 19.4 21.2 32.0 48.4 19.1 -36.4 -48.5 -55.6 -75.5 MONTHLY: If/'MUNI * HflkTS ARE B*A B UN CtbIn f PREVIOUS MONTH REPORTED DATA. 2/ BASED ON QUARTERLY AVERAGE DATA. P - PRELIMINARY. ltu MUNIHLT AVhKAbk -16.9 WaA" Ap- Lf-% 9-1MILI -2.8 17.0 30.7 40.9 L 9.7 9.6 8.9 5.5 3.9 8.1 7.9 7.2 8.8 6.3 I -4.5 -6.8 16.0 6.8 4.5 17.8 24.2 21.5 12.7 4.2 I r 75.0 81.1 58. I 57.9 53.3 Table 4 NOV. 16, 1979 Components of Money Stock and Related Measures Period Other Than CDs o 1. 2 3 Total ,'o 4 Savings . 5 ShortTerm U.S. Gov't Mutual Savings Credit Union Svings Bank & S&L Shares Bonds Savings Debsltt Time and Tm Currency Demand Deposits Other CDs 4 7 1j Shares 8 9 1 Other Private Short term Total Non 1 Gov't Deposit Funds Demand Sec _ AssetsV/ 10 11 12 I I Deposits 4 13 ANNUALLY: 80.8 88.6 97.5 233.0 250.1 263.7 489.2 544.4 611.2 426.7 470.7 514.6 202.1 219.7 223.0 224.7 251.0 291.5 62.4 73.7 96.6 456.1 518.3 571.2 38.9 46.6 53.1 71.9 76.6 80.6 66.2 77.2 85.3 47.7 56.3 85.3 54.6 61.8 84.9 11.4 11.7 15.4 MONTHLY: 1978--0CT. NOV. DEC. 95.8 96.6 97.5 265.3 264.0 263.7 597.7 608.5 611.2 509.1 513.1 514.6 225.9 224.3 223.0 283.2 288.8 291.5 88.6 95.4 96.6 562.1 566.7 571.2 52.5 52.7 53.1 80.1 80.3 80.6 83.2 82.2 85.3 75.2 79.9 85.3 85.0 82.5 84.9 20.1 21.0 15.4 1979--JAN. FEB. MAR. 98.2 98.9 99.4 261.5 259.7 259.5 615.8 620.2 619.5 515.3 518.1 520.5 220.8 218.6 217.7 294.6 299.5 302.9 100.5 102.1 99.0 575.8 580.4 584.7 52.9 52.6 53.3 80.7 80.6 80.6 87.3 88.7 93.0 89.7 93.7 97.0 83.1 95.8 100.8 14.7 10.2 9.4 1976 1977 1978 APR. MAY JUNE 100.2 100.7 101.5 264.1 263.8 267.5 620.6 619.9 620.3 525.6 529.4 535.4 217.7 216.4 217.8 307.9 313.0 317.6 95.0 90.6 84.9 587.4 589.3 593.3 53.6 53.8 54.6 80.6 80.6 80.6 97.3 100.4 102.7 100.6 104.8 109.5 104.9 111.2 115.8 8.1 9.3 13.8 JULY AUG. SEPT.P 102.4 103.6 104.9 269.8 270.7 273.0 626.6 634.2 642.2 542.0 548.2 554.1 219.5 220.7 220.7 322.4 327.6 333.4 84.7 85.9 88.1 597.2 600.8 605.2 55.7 56.7 57.3 80.6 80.6 80.7 102.6 101.6 102.0 114.6 120.2 126.0 119.5 130.3 138.6 16.0 15.9 15.8 OCT. P 105.3 273.2 651.1 560.0 217.6 342.3 91.1 608.4 57.5 80.8 101.9 131.6 140.1 15.6 1979-SEPT. 12 19 26 104.4 104.7 104.8 273.8 272.6 272.9 640.3 642.7 644.1 553.1 554.3 555.1 221.9 220.9 219.7 331.2 333.4 335.4 87.2 88.4 89.0 15.6 15.5 17.6 OCT. 3P 10P 1/P 24P 31P 105.3 105.4 105.2 105.2 105.6 274.4 275.1 273.5 271.7 270.6 646.2 649.0 650.9 652.1 654.2 557.0 559.2 560.0 560.2 561.6 219.3 219.4 218.4 216.8 215.1 337.7 339.8 341.7 343.4 346.6 89.2 89.9 90.9 91.9 92.5 15.7 12.2 16.3 17.7 16.4 NOV. TP 105.9 273.3 656.9 562.9 212.6 350.3 93.9 11.0 WEEKLY: 1/ 2/ ai I I I I ESTIMATED MONTHLY AVERAGE LEVELS DERIVED BY AVERAGING END OF CURRENT MONTH AND END OF PREVIOUS MONTH REPORTED DATA. INCLUDES PRIVATE DOMESTIC NONFINANCIAL INVESTORS' HOLDINGS OF COMMERCIAL PAPER, BANKERS ACCEPTANCES, SECURITY RP'S AND MONEY MARKET MUTUAL FUND SHARES. 3/ BORROWINGS BY BANKS FROM OTHER THAN COMMERCIAL BANKS IN THE FORM OF FEDERAL FUNDS PURCHASED, SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE, AND OTHER LIABILITIES FOR BORROWED MONEY. PLUS NET LIABILITIES TO RELATED FOREIGN INSTITUTIONS, (NET EURODOLLAR BORROWINGS), LOANS SOLD TO AFFILIATES, LOAN RPS, AND OTHER MINOR ITEMS. 4/ INCLUDES TREASURY DEMAND DEPOSITS AT COMMERCIAL BANKS AND FEDERAL RESERVE BANKS AND TREASURY NOTE BALANCES. P - PRELIMINARY - STRICTLY CONFIDENTIAL (FR) TABLE 5 SELECTED INTEREST RATES (percent) Federal funds Short-Term CDs Treasury Bills Secondary Market Auction Market 3-mo 1-yr 6-mo 90-day (5) (3) (4) (2) Co. Paper 90 Day* (6) Bank P e Rat CLASS II - FOMC NOVEMBER 16, U.S. Govt. Constant Maturity Yields 3-yr 7-yr 20-yr Long-Term Corp.-Aaa Utility New Recently Issue Offered (12) (11) Municipal Bond Buyer (13) 1979 Ho e Mortgages Secondary Market mary FNMA GNMA on Auc; Sec. (16) (14) (15) (7) (8) (9) (10) 1978--High Low 10.25 6.58 9.30 6.16 9.62 6.55 9.58 6.42 10.96 6.76 10.52 6.68 11.57 7.75 9.59 7.40 9.22 9,00 8.01 9.30 8.61 9.54 8.48 6,67 5.58 10.38 8.98 10.60 9.13 9.68 8.43 1979--High Low 15.61 9.93 12.60 8.85 11.89 8.64 12.65 8.87 14.53 9.84 14.26 9.66 15.46 11.50 11.83 8.78 11.09 10.56 8.79 11.51 9.40 11.45 8.74 9.39 7.38 6.08 12.85 10.38 13.29 10.42 11.77 9.51 1978--Oct. Nov. Dec. 8.96 9.76 10.03 7.99 8.64 9.08 8.45 9.20 9.44 8.49 9.20 9.40 9.45 10.72 10.72 8.98 10.14 10.37 9.94 10.94 11.55 8.62 9.04 9.33 8.64 8.80 9.03 8.69 8.75 8.90 9.17 9.27 9.28 9.13 9.27 9.41 6.13 6.19 6.51 9.86 10.11 10.35 10.03 10.30 10.50 9.25 9.39 9.38 1979--Jan. Feb. Mar. 10.07 10.06 10.09 9.35 9.32 9.48 9.54 9.39 9.38 9.50 9.35 9.46 10.51 10.19 10.13 10.25 9.95 9.90 11.75 11.75 11.75 9.50 9.29 9.38 9.14 9.11 9.15 8.98 9.03 .9.08 9.54 9.53 9.62 9.51 9.56 9.62 6.47 6.31 6.33 10.39 10.41 10.43 10.70 10.54 10.43 9,67 9.67 9.70 Apr. May June 10.01 10.24 10.29 9.46 9.61 9.06 9.28 9.27 8.81 9.50 9.53 9.06 10.06 10.16 9.95 9.85 9.95 9.76 11.75 11.75 11.65 9.43 9.42 8.95 9.21 9.23 8.86 9.12 9.21 8.91 9.70 9.83 9.50 9.74 9.84 9.50 6.29 6.25 6.13 10.50 10.69 11.04 10.59 10.84 10.77 9.78 9.89 9.75 July Aug. Sept. 10.47 10.94 11.43 9.24 9.52 10.26 8.87 9.16 9.89 9.19 9.45 10.13 10.11 11.89 9.87 10.43 11.63 11.54 11.91 12.90 8.94 9.14 9.69 8.92 9.05 9.38 8.92 8.97 9.21 9.58 9.48 9.93 9.53 9.49 9.87 6.13 6.20 6.52 11.09 11.09 11.30 10.66 10.67 11.09 9.77 9.90 10.31 10.95 10.47 9.99 10.97 10.91 7.08 11.64 12.52 11.25 9.38 9.34 9.37 9.41 9.18 9.19 9.19 9.26 -9.84 9.97 9.98 9.70 9.87 9.92 10.00 6.47 6.49 6.57 6.56 11.20 11.30 11.35 11.35 10.92 10.14 10.36 10.38 10.36 11.66 (I) 13.77 11.70 11.23 11.34 13.66 13.23 14.39 5 12 19 26 11.02 11.30 11.37 11.61 9.91 10.43 10.35 10.12 9.62 9.95 9.94 9.84 9.78 10.29 10.32 10.11 11.39 11.87 12.04 11.91 11.03 11.59 11.76 11.74 12.25 12.68 12.96 13.21 3 10 17 24 31 11.91. 12.00 13.22 15.14 15.61 10.26 11.21 11.61 12.60 12.13 9.95 10.77 11.26 11.89 11.69 10.33 10.66 11.72 12.65 12.19 12.01 12.94 13.59 14.44 14.47 11.71 12.43 13.29 13.79 14.14 13.46 13.79 14.50 14.64 15.00 9.85 10.65 11.01 11.83 11.64 9.58 10.29 10.56 11.09 11.00 9.38 9.85 10.04 10.42 10.44 10.22 10,88 11.05 11.45 11.51 10.25 10.79 11.00 11.36 11.42 6.64 7.12 7.18 7.38 7.26 11.35 11.45 11.75 12.00 12.80r 7 14 21 28 13.77 13.30 12.16 12.11 11.74 11.31 12.09 11.95 14.53 14.28 14.26 14.09 15.25 15.46 11.56 ll.10p 11.03 10.80p 10,56 10.40p 11.50 11.51p 11.45 11.45p 7.27 7.31 12.85 n.a. 13.52 4 . 0p 12.44 11.70 11.76 11.00 --- 14.63 14.13 14,21 13.62 15.25 15.50 11,67 6 11.0 p 11.10 8 10.7 p 10.61 10.35p Oct. 1979--Sept. Oct. Nov. Daily--Nov. 10.71 7.72 8 15 1 3 11.25 10.65 11.02 11.21 11.77 11.58 12.60 13.29 - 12.93 11.73 11.51 NOTE: Weekly data for columns 1, 2, 3, 5, 6, and 7 are statement week averages of daily data. Weekly data in column 4 are average rates set in the auctions of 6-month bills that will be issued on the Thursday following the end of the statement week. For columns 8 through 11, the weekly date is the mid-point of the calendar week over which data are averaged. Columns 12 and 13 are 1-day quotes for Friday and Thursday, respectively, following the end of the statement week, Column 14 is an average of contract interest rates on commitments for conventional first mortgages with 80 percent loan-to-value ratios made by a sample of insured savings and loan associations on the Friday following the end of the statement week. Column 15 gives FNMA auction data for Monday preceding the end of the statement week. Column 16 is a 1-day quote for 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 securties for immediate delivery, assuming prepayment in 12 years on pools of 30-year FHA/VA mortgages carrying the coupon rate 50 basis points below the current FHA/VA ceiling. * 90-119 day maturity prior to November 1979. TABLE 6 STRICTLY CONFIDENTIAL (FR) CLASS II - FOMC NOVEMBER 16, 1979 1/ NET CHANGES IN SYSTEM HOLDINGS OF SECURITIES(millions of dollars, not seasonally adjusted) Treasury Bills Net Ceriodhange 2/ c g period Treasury Coupons Net purchases 3/ wi n 1 year - 5 5 - 10 Federal Agencies Net Purchases 4/ Over 10 Total Toalar Wih 1 - 5 Net Change Outright Net RPs 5 - 10 Over 10 244 659 460 203 428 104 101 318 138 114 213 24 864 3,082 1,613 891 1,433 127 9,273 6,303 7,267 6,227 10,035 8,724 -46 -154 1,272 3,607 -2,892 -1,774 -- --- -173 -- 4,632 -3,283 226 -2,130 -8828 -1,7958,129 680 2,542 -2,019 Total Holdings Total 5/ 7,232 1,280 -468 863 4,361 870 207 320 337 472 517 1,184 579 797 3,284 3,025 2,833 4,188 500 434 1,510 1,048 758 1,526 129 196 1,070 642 553 1,063 1,415 1,747 6,202 5,187 4,660 7,962 120 439 191 105 --47 400 1,665 824 469 792 45 1978--Qtr. III Qtr. IV 3,152 -5,072 340 212 774 1,135 349 250 235 247 1,697 1,844 -92 -- -81 - 1979--Qtr. I Qtr. II Qtr. III -3,750 465 5,363 48 42. 395 426 640 '1,289 134 -309 93 -310 700 682 2,302 -170 110 191 -229 258 288 -2 3 --- -399 371 482 1979--May June -451 -105 -42 --- --- -42 -110 258 -2 --- -371 -491 275 -2,353 5,840 July 2,252 218 237 96 142 693 191 288 3 -- 482 3,427 -1,665 Aug. Sept. 1,712 1,399 57 120 699 354 140 73 81 87 976 634 -- --- --- --- -- 2,687 2,015 -2,279 1,922 -219. 28 703 - -- 731 -- -- -- -- -- 59 -2,499 5 12 19 26 107 -200 630 486 ----- ----- ---- ----- -- --- -- -- ---- ----- 107 -218 630 486 -5,531 -5,182 3,396 5,699 3 10 17 24 31 1,333 -970' 103 -240 132 120 -28 -- 73 6349 668-63 -- - -- --- 87 ----- --- ---- --- --- ---- 1,2999 -305103 -177 132 -8,223 4,470 400 -483 1,739 7 14 21 -198 1,937 --- -- -- --- --- --- --- -- -198 1,937 -2,903 -643 1.8 4.3 1.4 .7 8.2 126.0 1973 1974 1975 1976 1977 1978 Oct. 1979--Sept. Oct. Nov. 9/ -. 3549/ 668-35 --- - -- 9/ 28 LEVEL--Nov. 14 (in billions) 1 47.4 18.7 27.1 12.3 12.4 70.4 Change from end-of-period to end-of-period. 2/ 31 Outright transactions in market and with foreign accounts, and redemptions (-) in bill auctions. 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 borrowing from the System. 4/ 5/ Outright transactions in market and with foreign accounts only. 6/ I/ 8/ 9/ -4.7 Excludes redemptions, Excludes redemptions and maturity shifts. In addition to net purchases of securities, also reflects changes in System holdings of bankers' System and redemptions (-) of agency and Treasury coupon issues. Includes changes in both RPs (+) and matched sale-purchase transactions (-). acceptances, direct Treasury borrowings from the The Treasury sold $2,600 million of special certificates to the Federal Reserve on March 31, 1979 and redeemed the last of them on April 4, 1979. $640 million of 2-year notes were exchanged for a like amount of cash management bills on April 3, 1979. On April 9, 1979 the bills were exchanged for new 2-year notes. On October 1, 1979, $668 million of maturing 2- and 4-year notes were exchanged for a like amount of short-term bills, because the note auctions were delayed. On October 9 and 10, the bills were exchanged for new 2- and 4 -year notes, respectively.
@FedFRASER