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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 OF GOVERNOR#
F E D E R A L RESERVE SYSTEM
Hl 13
!o
'
160
„
'
'
August 12, 196lt.
CAPITAL MARKET DEVELOPMENTS ABROAD
I.
II.
I
Japan
Nine Charts on Financial Markets Abroad
Japan:
Money and Capital Markets i n June - July
Recently there have been signs of a slackening i n Japanese borrowing
^ i n both the United States and Europe, Japan f l o a t e d only one $10 m i l l i o n bond
i s s u e i n Europe i n July, and because of t i g h t e r conditions i n European money
markets, the Ministry of Finance i s reportedly planning t o reduce the volume of
private i s s u e s i n Europe during the next e i g h t months- Five more government
and government-guaranteed i s s u e s t o t a l i n g $93«5 m i l l i o n are scheduled to be
f l o a t e d before next April, along with p o s s i b l y three or four private i s s u e s of
$10-15) m i l l i o n each.
At the same time. U,S, short-term claims on Japan rose only $23 m i l l i o n
i n April-May i n contrast t o an increase of $226 m i l l i o n during the f i r s t quarter.
Long-term claims have also been r i s i n g much l e s s r a p i d l y i n recent months than
e a r l i e r . (See Table l ) .
Table 1.
1
Japan: Short- and Long-term Borrowings i n the U.S.
~
~~
( i n m i l l i o n s o f U,s. d o l l a r s )
Change during year
I960 1961 1962 1963
I
1963
11
III
Change during Period
196U
IV
Feb.. Mar Ap- • May
Total
U80
3
W
722 212
51
5
727 353
397
169
566
11
2
13
118
35
133
- 7 287
30 102
23 3B9
7h
93
11
32
m
ion
Securities 2/
Total
30
353
£8
W>
200 5 l
766 35
8U
237
60
5
%3 39H
m
1/
!•?/
±/
lhl
kOb
Bank-reported l i a b i l i t i e s to the U.S.
New s e c u r i t y f l o t a t i o n s
Preliminary,
.
0
0
ion
59
lit
73
- 7a/
61/
--11/
30
2
32
'o
73
0
-3a/
0
32
•
This slackening i n f o r e i g n borrowing has occurred at a time of continued
t i g h t conditions i n Japanese f i n a n c i a l markets, (See Table 2% Several of the
f a c t o r s contributing to the slowdown include a slower rate of increase i n acceptance
OFFICIAL USE ONLY
(Decontrolled a f t e r 6 months)
OFFICIAL USE ONLY
f i n a n c i n g s i n c e imports have i n c r e a s e d l e s s r a p i d l y , a t i g h t e n i n g i n European
f i n a n c i a l markets, and the consequent p o l i c y of limiting f u t u r e f l o t a t i o n s i n Europe
mainly to government and government-guaranteed i s s u e s 0 In a d d i t i o n , the improvement i n the balance-of-payments p o s i t i o n may be encouraging Japanese commercial
i n t e r e s t s t o expect some r e l a x a t i o n i n c r e d i t a v a i l a b i l i t i e s i n domestic f i n a n c i a l
m a r k e t s ' i n the near f u t u r e c
The balance o f payments continued to improve i n June as the s e a s o n a l l y
adjusted trade d e f i c i t narrowed f u r t h e r 0 Early i n July the M i n i s t e r of Finance
announced that the balance of payments f o r the c u r r e n t f i s c a l year ending next
March vd.ll probably r e g i s t e r a surplus of about $50 million,. This c o n t r a s t s with
a d e f i c i t of $150 m i l l i o n p r e d i c t e d by the M i n i s t e r l a s t January. I n t e r n a t i o n a l
r e s e r v e s r o s e $7 m i l l i o n i n June to $1,937 m i l l i o n , p r i m a r i l y as a r e s u l t of the
better-^trade performance and $65 m i l l i o n i n bond i s s u e s i n Europe = In J u l y ,
however 5 r e s e r v e s d e c l i n e d $22 m i l l i o n , i n p a r t , because of a much smaller r e f l u x
o f the E u r o - d o l l a r s t h a t had flowed out i n June 0 I n a move to reduce the adverse
e f f e c t s o f t h e s e v o l a t i l e short-term c a p i t a l f l o w s on the domestic money market
and at the same time s t r e n g t h e n the t i g h t money p o l i c y , Japan imposed e a r l y i n
July new q u a n t i t a t i v e l i m i t s on the short-term l i a b i l i t i e s of Japanese f o r e i g n
exchange banks»
On the domestic s i d e , money market c o n d i t i o n s t i g h t e n e d f u r t h e r i n June
and J u l y , and c a l l l o a n r a t e s increased,, The average i n t e r e s t r a t e on commercial
bank l o a n s and d i s c o u n t s a l s o r o s e i n A p r i l , continuing the general uptrend from
the low reached i n February c Bank credit, i n May rose a t the same r a t e as a y e a r
e a r l i e r , but more r a p i d l y than i n the previous four months„ The stock market
eased a f t e r reaching a high for the y e a r e a r l y i n July and through August 3 show
no s i g n s of r a l l y i n g «
I n a move aimed a t reducing the l e v e l of e f f e c t i v e or r e a l i n t e r e s t
r a t e s , commercial banks " v o l u n t a r i l y " agreecT l a t e i n June to cut t h e i r compens a t o r y balance requirements by one-half i n s i x months and to e l i m i n a t e them
a l t o g e t h e r w i t h i n one y e a r . I f t h i s move does a c t u a l l y reduce e f f e c t i v e i n t e r e s t
r a t e s , i t i s l i k e l y t h a t itcf would cause an i n c r e a s e d demand f o r bank c r e d i t „ I n
a d d i t i o n , an e a s i n g i n i n t e r e s t r a t e s would mean a b a s i c s h i f t t o an e a s i e r money
p o l i c y i n c o n t r a s t t o the p r e s e n t p o l i c y of f i n a n c i a l retrenchment 0 Although
the Japanese are o p t i m i s t i c regarding an e a r l y r e s o l u t i o n of the balance of payments problem,, t h i s i s s t i l l i n the realm of e x p e c t a t i o n s rather than r e a l i t y 0
Money market 0 Conditions i n the money market continued t o t i g h t e n
i n June i n s p i t e of a n e t expansionary impact from monetary developments„ An
i n c r e a s e i n Bank of Japan c r e d i t of ¥l5h b i l l i o n and net Treasury payments of
¥"5 b i l l i o n i n June more than o f f s e t the c o n t r a c t i o n a r y impact from a ¥120 b i l l i o n i n c r e a s e i n bank notes i n c i r c u l a t i o n = I n J u l y , the money market continued
to tighten.
OFFICIAL USE ONLY
— 3 -
OFFICIAL USE ONLY
I n t e r e s t r a t e s . Call loan r a t e s continued to increase i n June and July.
After remaining at 10*6 per cent during most of June, the r a t e f o r unconditional
c a l l loan money (repayable at a day's notice) jumped to 11<>3 per cent for the
l a s t four days of the month. During the f i r s t half of July the rate eased to the
e a r l i e r level of 10*6 per cent, but between July 1$ and 25 i t advanced to the
10,95 per cent l e v e l . The r a t e f o r over-night money (for settlement on the f o l lowing day) changed by the same degree during t h i s period and over-month-end
c a l l money (repayable a t a day's notice i n the following month) remained a t 12.8
per cent during June and most of July. (See Table 2).
Table 2.
Japans
Average Call Loan Money Rates i n Tokyo
(in per cent per annum)
Overnight l /
Unconditional 2/
Over-month-end 3 /
May
2
9
16
23
30
8 76 o
9.125
9.125
9.125
9.190
9.125
9.190
9.1*90
9.U90
9.855
11.680
11.680
11.680
11.680
11.680
June
6
13
20
27
10.220
10.220
10.220
10.950
10.585
10.585
10.585
11.315
12.775
12.775
12.775
12.775
July U
11
18
23
10.220
10.220
10.585
10.585
10.585
10.585
l0o950
10.950
12.775
12.775
12.775
12.775
1/ For settlement on following day.
2/ Repayable at a day's notice,
3/ 'Repayable at a day's notice i n the following month.
The average-monthly i n t e r e s t r a t e on bank loans and discounts continued to r i s e i n March and April, thus reversing the steady decline since
September of 1962 0 From a level of 7.70 per cent i n January-February, the r a t e
rose to 7.73 per cent and 7.85 per cent i n March and April, respectively.
This upturn r e f l e c t s the t i g h t money policy f i r s t i n s t i t u t e d l a s t December and
reinforced in January and March.
OFFICIAL USE ONIZ
IP
. OFFICIAL USE ONLY
Table 3»
Japans
'
u
~
Average Monthly I n t e r e s t Rate on Bank Loans and Discounts
( i n per cent per annum)
March
June
September
December
1/
"
1959
I960
1961
1962
1963
196U
8.18
8.28
8.06
8 oil
8.21
8.22
8„1U
8.08
7o92
7.88
8.00
8.20
80 22
8.23
8.2k
8.09
7.92
7.75
7.68
7.67
7.73
7.82
Aprilo
Bank, loans and discounts.
Bank c r e d i t rose 1 0 8 per cent i n May, the
same rate as a year e a r l i e r . During 'the January-April period, the average monthly
rate of increase was 1„0 per cento Loans and discounts of b i l l s rose 0 o 6 and 2„3
per cent i n May compared to 1 0 6 per cent f o r each category, r e s p e c t i v e l y , a year
earliero Holdings of s e c u r i t i e s increased 5>°U per cent, or s u b s t a n t i a l l y higher
than the 2.7 per cent r i s e a year e a r l i e r 0 Bank deposits were up only 1.2 per
cent i n contrast to a r i s e of 2.9 per cent a year e a r l i e r .
The proportion of bank loans and discounts extended for purchases of
equipment increased from 1 7 . 1 per cent i n April to 17=2 per cent i n Mayo , T h i s
i s the highest l e v e l since November of 1962 and i t i s well above the c y c l i c a l
low of 16,3 per cent i n March of 1963°
The credit expansion quota f o r Japan-s 13 large c i t y banks was s e t at
¥297o6 b i l l i o n f o r the third quarter of t h i s year by the Bank of Japan e a r l y i n
July c This i s 22 per cent below the actual c r e d i t expansion that occurred i n
the same period a year e a r l i e r 0 I n the f i r s t and second quarters, the c r e d i t
expansion l i m i t s were "set 10 and 12 per cent below the actual amount of c r e d i t
expansion that occurred a year e a r l i e r .
Late i n June the Federation of Bankers1 Associations announced that i n
response to government requests, i t had "voluntarily" i n s t r u c t e d member banks to
reduce compensatory balance requirements to one-half of t h e i r current l e v e l within
s i x months and to eliminate them altogether within one year. The general aim of.
t h i s move i s to reduce the l e v e l of e f f e c t i v e or r e a l i n t e r e s t rateso
Bond marketo New i s s u e s of bonds i n May totaledT ¥138 b i l l i o n , up ¥ 5
b i l l i o n from the April l e v e l 0 The major f a c t o r i n the r i s e was an increase i n
new i s s u e s of bank debentures from ¥80 b i l l i o n i n April to ¥8U b i l l i o n i n May,
New i s s u e s of public corporation debentures were down ¥1 b i l l i o n from the April
l e v e l to ¥28 b i l l i o n i n May, and new i s s u e s of i n d u s t r i a l debentures rose ¥1
b i l l i o n to ¥26 b i l l i o n 0
Average y i e l d s on bonds and debentures were unchanged i n May from the
April l e v e l except for a s l i g h t r i s e i n the y i e l d on i n d u s t r i a l bonds from 7»U83
per cent to 7dt89 per cento
OFFICIAL USE ONLY
OFFICIAL USE ONLY
Stock market. Stock p r i c e s improved i n June, reaching a high f o r t h e
year on July 3* but during the r e s t of J u l y d e c l i n e d t o lower l e v e l s „ Between
April 9 — a low f o r t h e year — and July 3, stock p r i c e s rose lU per c e n t . On
August 3, p r i c e s were s t i l l 5 per cent below the y e a r ' s high 0 The May-June uptrend has been a t t r i b u t e d p r i m a r i l y t o the improved balance-of-payments p o s i t i o n .
Table
Dow Jones Average o f 225 S t o c k s , F i r s t S e c t i o n of Tokyo Exchange
May 25
¥ 1,318
June 1
8
15
22
29
1,319
1,299
i,3U5
1,316
l,3k8
July
Augo
6
13
20
27
¥1,363
1,331
1.325
1.326
3
1,30U
1963 High
Low
¥1,201
1961i High
Low
¥ 1,369
¥ 1,203
¥ 1,63k
Foreign trade 0 The s e a s o n a l l y adjusted trade d e f i c i t continued to
narrow i n June as e x p o r t s r o s e 5 per c e n t and imports remained unchanged,,. The
June d e f i c i t of $108 m i l l i o n was the l o w e s t t h i s year and r e p r e s e n t e d a subs t a n t i a l improvement from t h e peak d e f i c i t i n January of $225 m i l l i o n , . Most
of the improvement i n the trade balance has been due to a s u b s t a n t i a l expansion
of e x p o r t s , imports having r i s e n o n l y s l i g h t l y 0 The trade f i g u r e s (monthly,
or monthly a v e r a g e s , on a customs b a s i s ) i n Table 5 are based on s e a s o n a l a d j u s t ment f a c t o r s computed by the Board of Governors o f the Federal Reserve System,,
Table 5°
Imports
Exports
Balance
U9U
382
1962
II III
IV
1*68 U52
U09 U26
U6I4.
iql;
"112 - £9 -26 - 50
Japan;
U88
U22
S e a s o n a l l y Adjusted Foreign Trade
( i n m i l l i o n s of U„S„ d o l l a r s )
1963
II III
IV
I
515 582
kh3 U6l
6U3
U8U
659
U91
- 66 - 1 0 2 - 1 2 1 -159
II
66I4.
5Ul
-168-123
1961
Mar. Apr.
628
517
-111
May
669 662
5U2. 526
June
662
551
-127 - 1 3 6 - 1 0 8
Foreign r e s e r v e s and c a p i t a l f l o w s „ I n t e r n a t i o n a l r e s e r v e s f e l l $22
m i l l i o n i n July t o a l e v e l o f . $ 1 , 9 1 5 m i l l i o n . Preliminary r e p o r t s i n d i c a t e t h a t
the primary cause of the d e c l i n e was a smaller volume of c a p i t a l r e c e i p t s , due
i n p a r t t o a much smaller r e f l u x i n July of t h e E u r o - d o l l a r s t h a t had f l o w e d out
i n June„ Since l a s t October's peak, r e s e r v e s have d e c l i n e d $187 m i l l i o n , ,
The current account d e f i c i t i n the balance o f payments, a s measured on
an exchange t r a n s a c t i o n s b a s i s , narrowed s u b s t a n t i a l l y from $102 m i l l i o n i n May
to $hk m i l l i o n i n June. The d e f i c i t on commodity trade d e c l i n e d s h a r p l y from "
OFFICIAL USE ONLY
-
OFFICIAL USE ONLY
6
-
$53 m i l l i o n i n May to $9 m i l l i o n i n June, and n e t payments f o r s e r v i c e s a l s o d e c l i n e d from $b9 m i l l i o n t o $35 m i l l i o n . Net long-term c a p i t a l r e c e i p t s were $70
m i l l i o n , b o l s t e r e d by $65 m i l l i o n i n Japanese s e c u r i t i e s i s s u e s i n Europe during
June* Net short-term c a p i t a l r e c e i p t s o f $27 m i l l i o n brought t o t a l c a p i t a l
r e c e i p t s to $97 m i l l i o n . Since r e s e r v e s r o s e $7 m i l l i o n i n June, while recorded
net r e c e i p t s were $53 m i l l i o n , errors and omissions t o t a l e d $l±6 million,,
According t o p r e l i m i n a r y data, Japanese s h o r t - t e r m l i a b i l i t i e s t o the
U»So as reported by U.S, banks r o s e $30 m i l l i o n i n May to $2,398 m i l l i o n . This
i s a smaller monthly i n c r e a s e than those r e g i s t e r e d e a r l i e r i n the y e a r , and
probably r e f l e c t s the r e c e n t s l a c k e n i n g i n the volume of imports which i n t u r n
has had an impact on t h e volume o f acceptance f i n a n c i n g .
Table 6 S h o r t - t e r m Claims on Japan Reported by U.S. Banks
( i n m i l l i o n s of U,S 0 d o l l a r s )
1959
1960
1961
1962
1963
1961
Jan 0
Feb.
Mar,
168
,362
875
i,601
1,697
2,223
175
372
952
1,685
1,691
2,316
20U
U20
1,069
1,778
1,751
2,375"
Apr 0
Dec,
May
221;
2lt2
26 0
250
U88
U67
1,159 1,196 1,272
1 , 7 7 5 1,762 1 , 7 5 8
1,876 1,896 1,869
2,368a/2,398a/
256
586
1,311
1,765
1,872
269
628
1,335
1,767
1J93
262
660
1,288
1,711
1,862
262
693
1,281
1,710
1,876
27 5
32k
711
806
1,292 1,528
1 , 6 6 2 1,7U0
1,995 2,lk9
NOTE:
a/
Data f o r 1962 and 1963 have been r e v i s e d and i n c l u d e $52 m i l l i o n r e p o r t e d by banks
i n i t i a l l y as of December 31, 1 9 6 l ,
Preliminary.
Japan p l a c e d two bond i s s u e s i n Europe i n June t o t a l i n g $65 m i l l i o n . The
f i r s t was a $15 m i l l i o n , 1 5 - y e a r , 6 - 1 / 2 per c e n t c o n v e r t i b l e bond i s s u e by the Toyo
Rayon Company i n London and Luxembourg, and the o t h e r was a $50 m i l l i o n , 1 5 - y e a r ,
6 per c e n t bond i s s u e i n Germany p l a c e d by the Government of Japan, The o n l y
European f l o t a t i o n i n J u l y was a $10 m i l l i o n , l 5 - y e a r , 6 - 1 / 4 per cent c o n v e r t i b l e
bond i s s u e p l a c e d i n London and Luxembourg by H i t a c h i , Ltd, O r i g i n a l l y t h i s i s s u e
was scheduled to be $15 m i l l i o n , but i n view of the r e c e n t t i g h t n e s s i n the
European c a p i t a l market, the amount was lowered to $10 m i l l i o n . Reports i n d i c a t e
t h a t because o f the r e c e n t i n c r e a s e s i n o f f i c i a l d i s c o u n t r a t e s i n s e v e r a l
European c o u n t r i e s and a subsequent t i g h t e n i n g of the c a p i t a l market, the M i n i s t r y
of Finance w i l l g i v e p r i o r i t y during the rfest of t h e year to government and government-guaranteed bond i s s u e s i n Europe, s c a l i n g down somewhat the planned volume
of p r i v a t e bond i s s u e s .
OFFICIAL USE ONLY
OFFICIAL USE ONLY
Table 7 .
Japan?
Long-term Borrowings i n Europe Reported i n F i n a n c i a l Press a /
Capital
Markets
Amount
Month
Floated
Bank of Japan
$ 7 . 0 m.
Jan. 1962
Two 5 - y e a r c r e d i t s from 3 Swiss
banks a t 5 - 1 / 2 - 5-3/U per c e n t
i n Sw0 francso
Switz.
Osaka C i t y and
Prefecture
$2^,0 m.
Febo 1962
6-1/2%s
DM bond i s s u e .
Germany
Osaka City and
Prefecture
$ 2 5 . 0 m»
Maro 1963
6-1/2%9
DM bond i s s u e 0
Germany
G o v ' t , o f Japan
L 5 mi11e
($1U.5 m.)
Aug. 1963
6%s UoSo d o l l a r s 20-25 y e a r s ,
conversion of 1899 bond i s s u e .
U.K.
Takeda Chemical Co* $ 1 5 . 0
Dec. 1963
6%s U0S0 d o l l a r , 2 0 - y e a r , conv e r t i b l e debentureso
Luxembourg
Canon Camera Co
$ 5 . 0 m.
Dec. 1963
6 - 1 / 1 $ 5 U.S. d o l l a r , 1 5 - y e a r ,
c o n v e r t i b l e debentures.
Osaka C i t y and
Prefecture
$ 2 5 . 0 m.
Jan. 196I4
6-1/2%}
Gov'to of Japan
$ 1 1 . 5 m.
Febo 196 k
5=5%, Sw f r a n c s , 10-15 y e a r s .
Switz.
Teijin.ltdo
$ 1 0 . 0 m,
Mar. 196U
6 - 1 / 1 $ , U.S. d o l l a r , 2 0 - y e a r ,
c o n v e r t i b l e debentures.
Luxembourg
C. I t o h & Co.
$ 1 2 . 5 m.
Mar. 1961*
6-l/k%9 U.S. d o l l a r , 20-year,
c o n v e r t i b l e debentures.
London
Taisho Marine &
F i r e I n s , Co.
$ k>h m»
Mar. I96L
Equity i s s u e (London Depositary
R e c e i p t s ) , 20 m i l . shares a t
$ 0 . 2 2 per share.
London
Metropolis of
Tokyo
$22.5 m.
Apr. 196U
5 - 3 A ^ s U.So d o l l a r , 1 5 - y e a r ,
guaranteed d o l l a r bonds.
Europe
Toyo Rayon Co.
$15.0 m.
June 196U
6-l/k%, U.S. d o l l a r , 1 5 - y e a r ,
c o n v e r t i b l e debentures.
London &
Luxembourg
Gov't, o f Japan
$50o0 mo
(200 EM)
June I96U
6%s 1 5 - y e a r , DM bond i s s u e .
Germany
H i t a c h i , Ltd.
$ 1 0 e 0 m.
J u l y 196U
6-l/h%s 1 5 - y e a r , c o n v e r t i b l e
debenture.
London &
Luxembourg
Borrower
1l7
Terms
1 5 - y e a r , DM bond i s s u e .
• U.K.
Germany
Although t h i s l i s t i s b e l i e v e d t o be complete, some i s s u e s may have been o m i t t e d .
OFFICIAL USE ONLY
'
OFFICIAL USE ONLY
Early i n J u l y the Bank o f Japan imposed q u a n t i t a t i v e l i m i t s on Japanese
f o r e i g n exchange banks' short-term l i a b i l i t i e s i n the form of Euro-dollars and f r e e
yen d e p o s i t s . S p e c i f i c d e t a i l s were not r e l e a s e d , but each bank has r e p o r t e d l y
been" assigned a f i x e d c e i l i n g f o r the two types of l i a b i l i t i e s i n d i c a t e d above,
the l i m i t s being c a l c u l a t e d as a percentage of n e t f o r e i g n exchange a s s e t s . These
f o r e i g n l i a b i l i t i e s w i l l continue t o remain s u b j e c t t o minimum f o r e i g n exchange
r e s e r v e requirements. This l a t e s t move was taken i n order t o reduce the adverse
e f f e c t s on the domestic money market from v o l a t i l e short-term c a p i t a l f l o w s , and
to r e i n f o r c e the current t i g h t money p o l i c y tfiich has been o f f s e t a t times by
bank conversion of f o r e i g n short-term funds i n t o y e n .
Foreign exchange. The yen remained extremely weak i n the f o r e i g n exchange
market.during June and the f i r s t h a l f of J u l y . The r a t e i n the spot market f l u c tuated o n l y s l i g h t l y and the r a t e i n the three-month forward market remained unchanged
a t a depreciated l e v e l ,
(See Table 8 ) , E a r l y i n July the i n t e r - b a n k r a t e reached
a record high of ¥362.5>9 per d o l l a r , the most depreciated l e v e l i n the h i s t o r y of
the Japanese f o r e i g n exchange market. Part of the continued weakness has been a t t r i b u t e d t o a much smaller r e f l u x of E u r o - d o l l a r s i n t o Japan i n July f o l l o w i n g a
s u b s t a n t i a l o u t f l o w i n June as European banks engaged i n window-dressing o p e r a t i o n s .
Table 8.
Japan:
Customer's T.T. Exchange Rate of Bank of Tokyo i n Tokyo
Yen-dollar
spot middle
rate
May
June
July
29
Three-month
forward middle
rate
Forward d i s c o u n t
i n per c e n t
per annum
.06
362.35
362.UO
$
12
19
26
362.30
362.30
362.32
362.35
362.UO
362.UO
362.W
.362.1*0
J
362.UO
362.UO
362.UO
362.UO
362.U0
362.UO
15
Asia, A f r i c a ,
Latin America S e c t i o n .
OFFICIAL USE ONLY
„
.11
.11
.06
.06
INTERNATIONAL
MONEY
3-MONTH EURO-DOLLAR
Wednesda y lig u
MARKET
DEPOSIT
YIELDS
FOR
U.S.
VS. CERTIFICATE
DOLLAR
OF
INVESTORS]
DEPOSIT
YIELDS
.EURO-DOILAR DEPOSIT
DIFFERENTIAL:
U . S.
I NEW YORK
Friday figures
OFFER
RATES
ON
SELECTED
TREASURY
COMMERCIAL
(CANADIAN FINANCE COMPANY
E U RO - D Q L L A R_Q V E R
CE RT I F I C A T E
OF
D E P O S IT
3-MONTH
BILLS- Fully
INVESTMENTS
Hedged
PAPER-Fully
Hedged
INTEREST
ARBITRAGE,
3-MONTH
TREASURY
UNITED
BILL
STATES
/
CANADA
RATES
yVEiN
RATE
n
RATE
DIFFERENTIAL
:
'
DIFFERENTIAL
I
AND
FORWARD
:
WITH
:
•
FORWARD
CANADIAN
I
:
EXCHANGE
DOLLAR
—1
COVER
r
~
NET INCENTIVE IN FAVOR OF CANADA
1963
1964
u
INTEREST ARBITRAGE,
NEW
YORK/LONDON
Friday f i g u r e i
3-MONTH
Per c e n t p e r a n n u m
TREASURY
BILL
RATES
RATE D I F F E R E N T I A L
AND
3-MONTH
RATE
WITH
FORWARD
DIFFERENTIAL
1962
1963
FORWARD
STERLING
EXCHANGE
COVER
1964
196$
INTEREST
ARBITRAGE
FOR
GERMAN
COMMERCIAL
Friday figures
3-MONTH
BANKS
.
TREASURY
EUROTDOTLAR
BILLS,
DEPOSIT
INTERBANK
RATES
Per t e n l p e r o n n u
LENDING
{
RATE
i
EURODOLLAR LONDON
AND
I
J
GERMAN TREASURY BILLS
RATE
DIFFERENTIAL
AND
FORWARD
DEUTSCHE
MARK
FORWARD RATE DISCOUNT ( - )
TREASURY'BILLS
-
|
RATE
,
—
DIFFERENTIAL
NET INCENTIVE:i
WITH
!
p
,y-
FORWARD
,
^
EXCHANGE
^
COVER
IN FAVOR Of FRANKFURT 1+) -
i
•
i
INTERBANK LOAN RATE/
\
.
.
' SHORT-TERM
INTEREST
RATES *
EURO-DOLLAR - LONDON
—
t
—
1964
jand Switzerland (3 month drpoMi t rtfi*)
"I", 3- month r ale I or U S dollar de posiii in I o n d o n
w
LONG-TERM BOND
YIELDS
INDUSTRIAL
STOCK
INDICES
, 9 5 8 = 100
Ratio seal*
••
\ f ,
|
—y
, r r >
11 11 1 i _i_i_lj.. 1 1 >
Xy-^\--—\
1:
_1_1-1
I
I
I.i_l
1963
i
i
; . L J . 1. 1... i ' L I
1964
I
I
l_
I
SPOT
EXCHANGE
RATES
-
MAJOR
CURRENCIES
AGAINST
U.S.
P . , c.n»
A b o v . par
DOLLAR
''
B e l o w pa
_L_L
"1
ITALIAN LIRA
j
V
CANADIAN DOLLAR
T
3-MONTH
FORWARD
EXCHANGE
RATE_
Friday figures
AGAINST
AGAINST
U.S.
Per c e n t p e r o n n u m '
DOLLARS
POUND
STERLING
- LONDON
1
PREIMIUM 4-
-
"\
\*
'
1 I
AGAINST
1 1
POUND
1 1
i\
SWISS F
RANC
A J2
v-rg/n
Vx)
1
i i
STERLING
-
1 1.
-
NT D ISIU
CC
1 I I 1 1
LONDON
PREMIUM +
FRENCH FRANC
A
-
1 1
1 1
1 1
1 1
1 1
@FedFRASER