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DIVISION O F I N T E R N A T I O N A L F I N A N C E - BOARD O F GOVERNORS - . OF THE FEDERAL RESERVE S f S T E H. 13 No. 242 April 6, 1966 CAPITAL MARKET DEVELOPMENTS ABROAD I. II. I. Ten Charts on Financial Markets Abroad Latest Figures Plotted in H.13 Chart Series, 1966 Ten Charts on Financial Markets Abroad Chart 1 - New York, London, Montreal: Yields for U.S. Dollar Investors on 3-month Funds - London: Yields for U.S. Dollar Investors on 3-month Funds 3 - Interest Arbitrage: Frankfurt/London, Zurich/London 4 - Interest Arbitrage: New York/Canada 5 - Interest Arbitrage: New York/London 6 - Short-term Interest Rates 7 - Long-term Bond Yields 8 - Spot Exchange Rates--Major Currencies Against U. S. Dollar 9 - 3-month Forward Exchange Rates 10 - Industrial Stock Indices Chart 2 Chart Chart Chart Chart Chart Chart Chart Chart Europe and British Commonwealth Section. OFFICIAL USE ONLY (Decontrolled after six months) NEW YORK, YIELDS DOLLAk LONDON, U.S. FOH DL- P O S I T MONTREAL: DOLLAR RATES: INVESTORS NEW ON 3-MONTH FUNDS YORK-LONDON EURO-DOLLAR DEPOSIT U . S . C E R T I F I C A T E OF D E P O S I T 1 \ ) . J ^ J ' ] * i W 1 K / | E U R O - D O L L A R OVER U , | U . S . C E R T I F I C A T E OF D E P O S I T FINANCE Friday fiflurei CO. PAPER RATES r * I \ v\ 1 | | (covered)-. *v\A ! \ j j | , | j QUOTED | IN I I NEW I y I 1 1 .. 1 1 1 1 YORK | CANADIAN FINANCE I COMPANY U.K. HIRE PURCHASE U.S. FINANCE COMPANY Mar. Jun. Sept. 1964 Dec. Mar. Jun. 1965 Sept. Dec. Mar. Jun. 1966 Sept. Dec. LONDON: EURO YIELDS DOLLAR FOR U.S. DEPOSIT DOLLAR INVESTORS ON 3 - M O N I H RATES FUNDS Af 9 0 DAY 1 8 0 DAY "30 D A Y C A L L HIRE P U R C H A S E Friday figures AND LOCAL AUTHORITY DEPOSIT RATES (covered) P« EURO-DOLLARLEPOSIT A - I - HIRE P U R C H A S E I I D I F F E R E N T I A L LV I I | FAVOR HIRE P U R C H A S E I | I I FAVOR E U R O D O L L A R I I I I I I I I l I I I i ' I I I I I I I I I I I I I I LOCAL AUTHORITY DEPOSIT EURO-DOLLAR DEPOSIT r 1 DIFFERENTIAL FAVOR LOCAL AUTHORITY FAVOR EURO-DOLLAR 1964 1965 1966 INTEREST ARBITRAGE: FRANKFURT FRANKFURT/LONDON, INTERBANK LOAN RATE VS. ZURICH/LONDON LONDON E U R O - D O L L AR~~RAT E ( C O V E R E D ) IN TERMS OF DM_ I N T E R B A N K LOAN R A T E EURODOLLAR r T .DIFFERENTIAL FAVOR FRANKFURT FAVOR EURODOLLAR ZURICH DEPOSIT RATE VS. LONDON EURO-DOLLAR RATE IN (COVERED) TERMS OF SWISS FRANCS EURODOLLAR S W I S S DEPOSIT RATE DIFFERENTIAL FAVOR ZURICH FAVOR E U R O D O L L A R H PRICE o r GOLD IN L O N D O N 35.2 35.0 1964 1965 1966 INTEREST ARBITRAGE, UNITED S T A T E S / C A N A D A 3-MONTH T R E A S U R Y BILL R A T E S 6 CAN. FIN. CO.iPAPER 4 CANADA UNITED S T A T E S I BILL R A T E D I F F E R E N T I A L U A AND FORWARD CANADIAN i M I i S P R E A D IN FAVOR OF CANADA i X | DOLLAR 1 1 0 A I F O R W A R D RATE , ' , 1 3.MONTH COVERED RATE D I F F E R E N T I A L S (NET I N C E N T I V E S ) PRIME FINANCE PAPER FAVOR CANADA 1 h\J 0 FAVOR U.S. FAVOR CANADA 1 TREASURY BILLS 0 FAVOR 1963 1965 1966 INTEREST Friday figures ARBITRAGE, 3-MONTH TREASURY NEW BILL Y O R K / L O N D O N RATES LONDON U.K. LOCAL AUTHORITY D E P O S I T S N E W YORK t- ec < O 1 E DIFFERENTIAL AND 3-MONTH WARD STERLING j I j 1 1 t • 1 S P R E A iD IN F A V O R OF LI ) N D 0 N l l 1 - U i - f•REMIUIM 0 k " ' V-"r * ^ r i f: 0 R W A RD RA TE J A IIISCOUI IT 1 AV j I I RATE 1 1 i i 1 I DIFFERENTIAL 1 1 1 1 1 WITH 1 1 FORWARD j 1 1 11 EXCHANGE COVER 11 (NET 1 1 1 1 INCENTIVE) IN F A V O R OF L O N D O N IN F A V O R OF N E W Y O R K 1963 1964 1965 1 1 1966 | | SHORT-TERM INTEREST RATES * U.K. E U R O D O L L A R - LONDON U.S. GERMANY SWITZERLAND 1 M i II I I 1 1 II I I i 11 1 II I 1963 1962 * IIIIIIIIII 1964 I1 1 III1 IIII 1965 IIIIIIIII1 II 1 1966 i bank loom and ducounli ) and Switzerland ( 3 month deposit rate ) +. 3 month rot# lor U 5 dollar deponfi m Loi LONG-TERM Weekly figures BOND YIELDS GERMANY J f \ rJ' U.K. V - U.S. CANADA NETHERLANDS U.S. SWITZERLAND 1962 1963 1964 1965 1966 S P O T E X C H A N G E RATES - M A J O R CURRENCIES A G A I N S T U.S. DOLLAR 1.6 S W I S S FRANC 1.2 G E R M A N MARK U.K. STERLING BELGIAN FRANC FRENCH FRANC DUTCH GUILDER CANADIAN DOLLAR ITALIAN LIRA J A P A N E S E YEN 1.2 M J S 1964 D M 1 1965 s D M 1 1966 S 0 3-MONTH Friday figures AGAINST FORWARD U. S. EXCHANGE RATES DOLLARS SWISS | AGAINST POUND STERLING . DISCOUNT- [ - L O N D O N M S W I S S FRANC JV\ I U. S . DOLLAR DISCOUNT- A G A I N ST POUND STERLING - LONDON I PREMIUM* 1 \ DUTCI \ GUILDE R Kj r FRANC LA.\ f \ J 1 v \ FRENCH FRANC 1 1 l I I I l 1 J 1 1 S 1964 1 1 DISCO U N T J 1965 | 1 1 s 1 1 1 1 1 1 1 1 INDUSTRIAL STOCK INDICES 300 SWITZERLAND 250 GERMANY U.K. 200 US 150 100 250 JAPAN 200 CANADA 150 100 1963 1964 ^ ^ Swtu Bonk Corporation induilriol Hock index Japan: index of 225 induitrial and other elocki traded on the Tokyo exchange 1965 1966 H. L a t e s t F i g u r e s P l o t t e d i n H. 13 Chart S e r i e s . ( a l l f i g u r e s per c e n t per annum) 13 No. 242 Chart 4 Chart 1 Upper p a n e l (Wednesday, March 30 (Friday, ) 1 Canada _2£L U.S. U . S . c e r t i f . of d e p o s i t April MQ U.S. Canada H i r e - p u r c h a s e p a p e r , U.K. Spread f a v o r Canada 5 f 13 5,93 5,49 N e t i n c e n t i v e (Canada + ) 41 5.88, Ch&rt 5 (Friday, April 1 April 1 U.K. U.S. Treasury b i l l s : Euto-$ d e p o s i t s : 5.25 5,38 5.56 -m Canadian f i n a n c e paper Chart 2 (Friday, 4.49 Forward Canadian $ 1 Finance co. paper: Call . 7-day 30-day April Treasury b i l l s : Buro-$ d e p o s i t Lower p a n e l (Friday, U April 6, 1966 196 90-day , 180-day , % 7,5 JlJLL- H i r e - p u r c h a s e paper (March 25) Local-authority deposit (March 25) Chart 3 Upper p a n e l ( P e r i o d : March 16-23 ?r89 I n t e r b a n k l o a n (mid p o i n t ) 2,62 Spread f a v o r U.K. -m Forward pound - n QA N e t i n c e n t i v e (U.K. + ) (Friday, n Apr-, i i Treasury b i l l s : U.S. 4.49 U.K. 5,45 Germany. J u m ( M n ± J 8 ) Canada Jusn Euro-$ d e p o s i t (London) Lower p a n e l (Date: February 15 Z u r i c h 3-mo. d e p o s i t 3.88 75 Z u r i c h 3-tno. d e p o s i t ( D a t e : ^Phrnarv 15 Japan c o m p o s i t e r a t e (Date: nprpmhpr n 35. 1 5 3 7 hn7 Chart 7 _) U.S. Gov't. For d e s c r i p t i o n and s o u r c e s o f d a t a s e e s p e c i a l annex t o H. 1 3 , Number 239, . March 16: 1966 AQ Chart 6 Eupo-$ d e p o s i t ( a v e r a g e ) P r i c e of g o l d (Friday, March 25 L (Wed. , Mar„ 30 ) U.K. War Loan ( T h u r s . , German Fed. (Fri., Swiss Confed. Mar, 3i) Mar. 25 ) (Fri., Canadian G o v ' t . 7r (Wed., Mar.30 81 3, ?2 Mar. 25 ) ) N e t h e r l a n d s G o v ' t , p e r p e t u a l 3% ( F r i . , Mar. 2 5 ) 5 A? s.
@FedFRASER