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FED ER A L RESERVE BANK OF N EW YORK r Circular No. 6 7 6 3 L July 15, 1971 T J DISCOUNT RATES To All Member Banks, and Others Concerned, in the Second Federal Reserve D istrict: W ith the approval o f the B oard o f G overnors o f the F ederal R eserve System, the directors o f this Bank have increased the B an k ’s discount rate from 4 % to 5 per cent, effective F riday, July 16, 1971. F ollow in g is the text o f a statement issued today by the B oard o f G overnors o f the F ederal R eserve S y stem : The Board of Governors o f the Federal Reserve System today approved actions by the directors of the Federal Reserve Banks o f New York, Philadelphia, St. Louis, and San Francisco, increasing the discount rate of those banks from 4 % per cent to 5 per cent, effec tive Friday, July 16. The action was in recognition of increases that have taken place in other short-term interest rates and is intended to bring the discount rate — which is the rate charged member banks for borrowing from their District Reserve Banks— into better alignment with short term rates generally. The move also reflected the B o a rd ’s concern over the continuation o f substantial cost-push inflation in the economy. The change in the rate, which previously had been lowered twice this year, returns it to the level prevailing in late January and early February. E nclosed is a copy o f this B a n k ’s Operating Circular No. 13, regarding discount rates. A dditional copies o f the enclosure will be furnished upon request. A lfred H ayes, President. Federal of Reserve Bank N ew York r Operating Circular No. 13 "1 L Revised July 16, 1971 J DISCOUNT RATES To All Member Banks, and Others Concerned, in the Second Federal Reserve District : 1. This Bank has established the follow ing new rates, effective July 16, 1971: A rate of 5 per cent per annum on advances to, and dis counts for, member banks under sections 13 and 13a o f the Federal Reserve A ct. A rate o f S1/^ per cent per annum on advances t-o member banks under section 1 0 (b ) o f the Federal Reserve Act. A rate of 7 per cent per annum on advances to individuals, partnerships, and corporations other than member banks under the last paragraph o f section 13 o f the Federal Reserve Act. Shown below is the schedule o f rates now in effect at this Bank on advances and discounts made under the Federal Reserve A ct. 2. This circular supersedes our Operating Circular No. 13, Re vised February 19, 1971. A lfred H ayes, President. Rate Schedule, Effective July 16, 1971 Per Cent Per Annum Advances to and discounts for m em ber banks: (a) Advances and discounts under sections 13 and 13a of the Federal Reserve Act ........................................................... ® (b) Advances under section 10(b) of the Federal Reserve Act ^V2 Advances to individuals, partnerships, and corporations other than member banks: Advances under last paragraph of section 13 of the Federal Reserve A c t .............................................................................. 7
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