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3 4 it" J u l y 1 1 , 1973 R e l e a s e No. 618 v H-13 Division of international Finance, Statistical & Data Managemel JUL I lFSMl 6 191,3 orLwTHitoi® SELECTED INTEREST & EXCHANGE RATES FOR MAJOR COUNTRIES & THE US. W E E K L Y SERIES O F C H A R T S BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM TABLE OF CONTENTS PART I. EXCHANGE RATES AND GOLD PRICES Chart 1A and B - Spot Exchange Rates, Major Currencies against U.S. Dollar Chart 2A and B - 3-Month Forward Exchange Rates, Major Currencies against U.S. Dollar Chart 3A and B - 3-Month Forward Exchange Rates, Major Currencies against U.K. Pound Chart 4 - Gold Price in London PART II. SHORT-TERM INTEREST RATES Chart 5 - Call Money Rates Chart M a n d ® - London: Euro-$ Deposit Rates ChartuA^nd B - New York - London: Yields on U.S. Dollar Funds Chart M a n d B - London: Covered Yields on U.S. Dollar Funds Chart 9A and B - Interest Arbitrage: United States-United Kingdom Chart 10A and B - Interest Arbitrage: U.S.-Germany and U.S.-Switzerland Chart 11 - Interest Arbitrage: United States-Canada Chart 12A and B - Selected Short-term Interest Rates PART III. LONG-TERM INTEREST RATES AND STOCK INDICES Chart 13 Chart 14 ' - Long-Term Bond Yields - Industrial Stock Indices PART IV. SELECTED CENTRAL BANK DISCOUNT RATES AND LATEST FIGURES PLOTTED ON THE CHARTS NOTE: This series is a continuation of the CAPITAL MARKETS DEVELOPMENTS ABROAD, which was published under that title through December 31,1968. The changes in the format and order of the charts are explained in the Supplement* to the series, which accompanied issue dated January 1, 1969. All series and their sources are fully described in a Supplement dated January 1, 1972. 3 CHART 1A I SPOT EXCHANGE RATE - MAJOR CURRENCIES AGAINST U.S. DOLLAR 32 Weekly averages Per Cent I yt 30 Above 28 26 24 24 22 22 20 20 18 16 6 4 12' 10 10 8 fi 2 Central r a t e __ a g a i n s t 0 C e n t r a l r a t e s are t h o s e in U.S. dollar 4 Below e f f e n v r>er. 1 9 7 1 . A P - t e A - s'..//Vr*. SPOT EXCHANGE RATE - MAJOR n?FPF • ' P S A.GAINST U.S. DOLLAR 32 Weekly a v e r a g e s 32 30 30 28 28 GtcamfitJ Mrtnk 13 16 fci I * DuVh fiuilr W I' il i l« • «!<• Centra I r a t e . agains t — U.S. d o ' l a r IIaL:*a/ i t * / * 1 9 1 9 7 7 2 r a 1 r a t e s are H-ic offer-h Pp-. ]971. K ^ CHART 1C SPOT EXCHANGE RATE - MAJOR CURRENCIES AGAINST U.S. DOLLAR Ratio s c a l e U.S. cents Weekly Beverages of d a i l y f i g u r e s U.K. Pound -260 250 -250 240 -240 102 100 100 Canadian j f o l l a r 19 7 2 19 7 3 b -MONTH FORWARD EXCHANGE - MAJOR CURRENGES AGAINST U.S. DOLLAR averages Per c e n ; ,er 4 CANADIAN DOLLAR 0 U.K. POUND 4 8 GERMAN MARK 4 + 0 4 PREMIUM DUTCH GUILDER 4 + 0 4 S 1970 S 1971 Canadian Dollar Rate not supported by Bank of Canada e DESCRIPTION AND SOURCES OF DATA, January 1, 1973, pp. 2 3. S D 1972 D M J 1973 S D n 3-MONTH FORWARD EXCHANGE - MAJOR CURRENCES AGAINST U.S. DOLLAR Weekly avef3F.es Per cent per anni PREMIUM < FRENCH FRANC DISCOUNT PREMIUM SWISS FRANC DISCOUNT M J S D 1970 M J S D 1971 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, pp. 2-3. M J S 1972 D M J S 1973 D i) Chart 3A 3-MONTH FORWARD EXCHANGE - MAJOR CURRENCIES AGAINST U.K. POUND Per cent per annum Friday figures PREMIUM GERMAN MARK U.S. DOLLAR DISCOUNT - I I I I I I I I 1 I I 1 I I I I I I I I I II M J S D 1970 M J S D 1971 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, p. 3. M J 1972 S 1 I I I I I I I I I I I D M J 1973 S D 3-MONTH FORWARD EXCHANGE - MAJOR CURRENCIES AGAINST U.K. POUND Friday figures &er cent per am SWISS FRANC FRENCH FRANC s 1971 See DESCRIPTION AND SOURCES OF DATA, J a n u a r y 1, 1973, p *3 s s s D 1970 1972 1973 GOLD PRICE IN LONDON, 12.5 Kg BARS Week's average of afternoon fixings U.S. dollar equivalent per fine ounce I I I I I I I I I M J S D M 1970 J S I I D 1971 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, p. 4. M I I I I I I I I I I I I I I J 1972 S D M J 1973 S D Chart 5A CALL MONEY RATES DOLLAR FUNDS Weekly averages ]5 05 Per cent per annum OVERNIGHT EURO-DOLLAR DEPOSITS CALL EURO-DOLLAR DEPOSITS FEDERAL FUNDS DIFFERENTIAL EURO-DOLLAR OVER FEDERAL FUNDS EURO-CURRENCIES Per cent per Weekly averages EURO-DM EURO-SWISS FRANC s s 1970 1971 * Changed f r o m CALL to OVERNIGHT Lure i M l . i r d e p o s i t s May 10. 1971 See DESCRIPTION AND SOURCES OF DATA. January 1. 1973 pp 4 6 1972 1973 Chart 5B CALL MONEY RATES SELECTED FOREIGN AND EEC CURRENCIES Friday figures Per cent per 12 8 FRANCE 4 NETHERLANDS 0 8 JAPAN 4 CANADA 0 12 8 U.K. 4 GERMANY 0 S 1970 D 1971 M J S D 1972 ice, Day-to-day Money, Netherlands, Call Money, weekly average, Japan, Unconditional Money, ada, Day-to-day Loans, weekly average, Germany, Call Money, U K , 2 day Local Authority Deposits DESCRIPTION AND SOURCES OF DATA. January 1, 1973, pp 4 6 M S 1973 D P Chart 6A LONDON: EURO DOLLAR DEPOSIT RATES Friday figures Per cent per annum 15 0 0 OVERNIGHT CALL 7-DAY 12 10 1-MONTH S D S M 1970 D 1971 * May 1 2 / 7 l - c h a n g e d to Overnight Euro-Dollar Deposits • • • J u l y 1—changed to 7-Day Euro-Dollar Digitized for INSCRIPTION FRASERAND SOURCES OF DATA, January 1, 1973, p. 6. D M 1972 M S 1973 D Chart 6B LONDON: EURO-DOLLAR DEPOSIT RATES Friday figures Per cent per 12 10 8 3-MONTH 6 \f\J^ 4 2 12 10 8 6-MONTH 6 4 2 1970 1971 OF DATA, January 1, 1973, p 6 1972 1973 Per cent per 12 10 8 EURO-DOLLAR DEPOSIT 6 4 U.S. CERTIFICATE OF DEPOSIT 2 FAVOR EURO-DOLLAR DIFFERENTIAL 4 + 0 EURO-DOLLAR OVER U.S. CERTIFICATE OF DEPOSIT D 1970 !'! •. K.. ; M S 1971 R, -ND SOURCESOF DATA. Janu D 1 1« ' • pi J 1972 h S D M 2 J 1973 S D Chart 7B * NEW YORK-LONDON: COST OF U.S. DOLLAR FUNDS 3-MONTH DOLLAR DEPOSIT RATES-PRIMARY MARKET Wednesday figures Per cent per annum EURO DOLLAR DEPOSIT ADJUSTED' A EURO-DOLLAR DEPOSIT U.S. CERTIFICATE OF DEPOSIT I ADJUSTED w EURO DOLLAR OVER U.S. CERTIFICATE OF DEPOSIT s M 1970 S D 1971 * Adjusted for Reserve Requirement * * Adjusted for 10% Marginal Reserve Requirement * * * Adjusted for 20% Marginal Reserve Requirement See DESCRIPTION AND SOURCES OF DATA, January 1 1973. pp 6 7 M J 1972 S D M J 1973 S D Chart 8A LONDON: COVERED YIELDS ON U.S. DOLLAR FUNDS HIRE P U R C H A S E / S T E R L I N G CD's vs EURO-DOLLAR Friday figures RATES Per cent per ann EURO-DOLLAR DEPOSIT HIRE PURCHASE COVERED STERLING CD's FAVOR STERLING CD's DIFFERENTIAL FAVOR EURO DOLLAR S S 1970 1971 1972 * Hire Purchase s u s p e n d e d A u g u s t 1 1, 1972 and Sterling C e r t i f i c a t e s of Deposit begin August 11, 1972. DESCRIPTION AND SOURCES OF DATA. J a r u a r v Digitized forSeeFRASER 1. 1 9 7 - , pp 7 b • D M J 1973 S ft Chart 8B LONDON: COVERED YIELDS ON U.S. DOLLAR FUNDS LOCAL AUTHORITY AND EURO-DOLLAR RATES Friday figures Per cent per annum 12 EURO DOLLAR DEPOSIT LOCAL AUTHORITY DEPOSIT COVERED I I I I I I I I I I I I I I I I I I I I I I I I I I I I I ,1 I I I I I I I I I I I I I I I I I I o FAVOR LOCAL AUTHORITY DIFFERENTIAL 'Vvna/Mi FAVOR EURO-DOLLAR I I I I I 1 1 I I I I I I I 1 I I 1 I I I I I I I I -I I I I I I I I I I I I 1 I I 1 I I 1 I I I 8 M J S D M 1970 J S D 1971 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, pp. 7-8. M J 1972 S D M J 1973 S D INTEREST ARBITRAGE: UNITED KINGDOM AND UNITED STATES Friday f g u r e i 3 - M O N T H TREASURY B I L L RATES U.K. LOCAL AUTHORITY DEPOSITS UNCOVERED NEW YORK LONDON NEW YORK M J S D M s D * Plotted for c o m p a r i s o n purposes See DESCRIPTION AND SOURCES OF DATA, J a n u a r y 1. 1973. pp. 8 9 s s f Chart 9B INTEREST ARBITRAGE: UNITED KINGDOM AND UNITED STATFS F nilav li^iaes I•« r • RATE DIFFERENTIAL AND 3 - M O N I H IORWARD S l l Rl ING I'M MIIJM SPREAD IN FAVOR OF LONDON FORWARD RATE DISCOUNT RATE DIFFERENTIAL WITH FORWARD EXCHANGE COVER FAVOR LONDON FAVOR NEW YORK M J S. D 1970 M J S D 1971 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, pp.8-9. M S 1972 D S M 1973 D Chart 10A 3-MONTH FUNDS INTEREST ARBITRAGE: EURO DOLLAR-GERMAN MARK FRANKFURT.INTERBANK LOAN RATE VS. LONDON EURO DOLLAR RATE Wednesday rates 1 i j 14 25 ! 1| ! ! j ! 1 1 . I i • , 1. | . : r > . j I i 1, i GE RMAN INTERBANK \ L O AN RATE i - , - ; / Per cent per anni 1 1 1 /1 1 II 1 1 1 12 rV v / J Aw VI - ElJRO-DOLLAR C( / - / IR FRANKFURT DIFFERENTIAL f\ ' ^Jv- - A A V - \l \yVvJ vaVV^ 1/ ^ FAVOR EURO DOLLAR 1 11111111111 M J S 1970 D II 1 1 1 1 1 1 1 II M J S II 1 II 1 II 1 II D 1971 See DESCRIPTION AND SOURCES OF DATA, J a n u a r y 1, 1973,"pp. 9 10 No q u o t a t i o n 1 1 1 1 1 1 1 1 1 1 1 1 J 1973 S 12 3-MOINTH FUNDS INTEREST ARBITRAGE: EURO-DOLLAR - SWISS FRANC ZURICH DEPOSIT RATE VS. LONDON EURO DOLLAR RATE Wednesday rates Per cent per annum I | I I I I I I I I | M | I I | I I I 12 SWISS DEPOSIT RATE \ EURO-DOLLAR COVERED FAVOR ZURICH DIFFERENTIAL FAVOR EURO DOLLAR I I I I I I I I I I I I I I I 8 1970 1971 See DESCRIPTION AND SOURCES OF DATA, January 1. 1973. pp 9 10 1972 1973 :3 3-MONTH INTEREST ARBITRAGE: CANADA - UNITED STATES Friday f i g u r e s Per cent per annul 1 1 | 1 1 | 1 1 | 1 1 1 1 1 1 1 1 1 1 1 1 1 BILL RATES | 1 1 | 1 1 | 1 1 II 1 1 | 1 1 | 1 1 | 1 1 / UNITED STATES TREASURY BILLS /y CAN. FIN. CO. PAPER Vy vZ'b^ - TREASURY BILLS 1 1 1 BILL RATE DIFFERENTIAiL AND FORWARD CANADAiN DOLLAR PREMIUM / v FORWARD RATE ; : GROSS SPREAD IN FAVOR OF C/ INADA DISCOUNT 1 COVERED RATE DIFFERIENTIALS v y FAVOR CANADA . PRIME FINANCE PAPEF vy VA W/'Wj v i i 1 i i 1 i i 1 i i ,! 1 1 1 1 1 1 1 1 1 1 M J S D M 1970 J S D TREASURY!BILLS FAVOR U.S. II M 1971 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, pp. 10 11. \J 1 II J 1 II 1 II S D 1972 i i 1 i i 1 i r 1 r i l M J S 1973 D 10 Chart 12 A SELECTED SHORT-TERM INTEREST RATES' Per cent per a n n u m - j - 14 — I r i "•Vi y V v v \ / \ ' ( w Vy i 1 1 i 1 GERMANY 1 ! 1 1 1 I 1 i ; i r ^ < - K u.s. 1 1 1 I I 1 1 1 1 j1 J 1 I I I 1 I J 1 1 1 i i 1 M 1 M J i 1 J J 1 I 1.1 i 1 l . l i 12 - • I V t f * U.K. 111 M i M 111 / / V ^ > h Z 1 1 1 1 1 I 1 1 I 1 1 y - , A t \ z U.S. 1 i 1 i I I 1 1 i 1 I 1 1 1 1 1 1 M 111 i i I i i ! i i 1 i i i i 1 i i s i i i i JAPAN MONTHLY - i i I I l l 1 ! ! 1971 i 1 • < ! 1: 1972 1 i ! i i ! i i 1 i i 1973 * 3 m o n t h treasury b i l l rates for all countries except JapamAverage rate on bank loans and d i s c o u n t s ) and G e r m a n y f l n t e r b a n k Loan Rate) See DESCRIPTION AND SOURCES OF DATA, January 1. 1973. pp 1 1 1 2 i i V - D Chart 12B SELECTED SHORT-TERM INTEREST RATES Per cent per z I v\Y \ . \ i 1 1 n /'Vi ^v V V , (0 DOLLAR - LONDO N\f i A r' ; v u - r . L / V I J . S . ! 1 I 1 1 1 1 1 1 1 1 I i i ! i i 1 i i 1 i i I l l I 1 l l 1 I l 1 1 1 1 1 1 1 1 1J 111 1 LLl 1 1 1 1J - i 1 il.S^ r \ v — i \ r i\ \JV V L i 1 1 V L / \ J L'V n ^ 1 1 I i " \_ I 1 / 1 SWITZERLAND1 1 i l1 1 1 1 1 1 1 1 11 11 '1 1 ! 1 1 1 1 T 1 1 l l l l l 1l 1 l 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 //• - U.S. , \\ , i 1 i i ! i i 1 i i J r VX \ CANADA ! i i 1 1 1 1 1 1 i1 i 11 i i 1970 1971 See DESCRIPTION AND SOURCES OF DATA. January 1, 1973. pp ii 1972 1112 i 1 i i 1 1 1 1 1 1 1 1 1i .: 1 1 1 1 1 i 1 ! 1 1973 1974 p LONG-TERM BOND YIELDS Weekly figures Per cent per a n n u m NETHERLANDS U.S. SWITZERLAND 11 U.K. GERMANY, CANADA T 11 M o n t h l y figures U.S. CORPORATE: DOLLAR EURO-BONDS AaaBONDS 1970 1971 1972 See DESCRIPTION AND SOURCES OF DATA, January 1, 1973, pp. 12 15. 1973 1974 ";1 INDUSTRIAL STOCK INDEXES Ratio scale, 1958 = 100 320 UNITED STATES 240 160 1200 480 960 SWITZERLAND 320 640 240 480 UNITED KINGDOM JAPAN GERMANY 160 320 CANADA 240 160 1970 1971 1973 July 11, H. 13 No. 618 1973 Country IV. SELECTED CENTRAL BANK DISCOUNT RATES Current Rate Previous Rate In Effect Since J u l y 5 , 1973 5.5 Mav10, 1973 J u l y 5, 1973 7.5 Nov. 30. 197: Apr. 10, 197\ ! 4.5 O c t . 14. 197: In Effect Since E.E.C.: Belgium 6.0 France 8.5 Germany 7.0 Italy 4.0 Netherlands . June 1, 1973 , May 3 . 1973 5.0 June 28, 197:$ 4.5 J u p e . l r 1973 8.25 May 18, 1973 8.0 Mav 11. 1973 Switzerland 4.5 J a n . 1, 1973 3.75 S e p t . 15.1972 Canada 6.25 June 10,1973 5.75 May 14. 1973 Japan 6.0 J u l y 2, 1973 5.5 Mav 30, 1973 United States 7.0 J u l y 1, 1973 6.5 June 8. 1973 **United Kingdom * * E f f e c t i v e October 13, 1972, t h e Bank of England r e p l a c e d i t s t r a d i t i o n a l Bank Rate w i t h a f l u c t u a t i n g "minimum l e n d i n g r a t e " based on average T r e a s u r y b i l l t e n d e r r a t e . J a n u a r y 19, 1973 . . . 8.75 IV-2 LATEST FIGURES PLOTTED ON THE CHARTS Chart Panel 1A Upper Series Lower, Upper Lower French franc » Japanese yen " Belgian franc „ Italian lire " +26.63 +0.31 Canadian dollar 2A 26 Upper Rate +37.10 257.26 +27.46 +16.50 Swiss franc U.K. pound IB Date July A c t u a l Rate " A c t u a l Rate " German mark " Dutch guilder " 6 . 100.13 +37.62 +37.10 German mark " +4.21 Swiss franc " +6.20 -2.41 +1.08 -1.68 +0.36 U.K. pound " Dutch guilder " Canadian dollar " French franc " / 3A German mark U.S. dollar 3B Swiss franc " French franc 4 5A Gold price, U.S. dollar per ounce Upper Overnight Euro-S deposits n Lower 5B Upper Differential j 8.52 10.21 " -1.69 Euro-currencies: | Euro DM ; Euro Swiss Fr. | Japan, Unconditional Money U.K., 2-day Local Author. Deps. ! Canada, Day-to-day Loans France, J3ay-to-Day Money Lower 123.25 July 4 Federal Funds Middle +6.38 +2.25 +5.06 +2.18 ! Germany-, Call Money | Netherlands Call Money J u l y11 6 1.75 1.38 May 30 May 29 6.75 7.19 May 27 July 6 5.43 9.00 9.50 5.03 May 29 IV-3 Chart Panel 6A 6B 7A Series Date Euro-$ Overnight Rate July 6 .. 10.06 Euro-$ 3-month Rate » 9.81 Euro-$ 6-month Rate II Euro-$ 3-month Deposits Lower Differential it Upper Euro ) 3-month Deposits .. 9.50 Euro-$ 3-month Deposits (Adj.) If 9.72 U.S. Certificate of Deposits (Adj.) II 9.15 Differential: on Adj. Euro-$ Deposits ,, +0.57 July 4 Upper Euro-$ 3-month Deposits „ +0.56 +0.35 June 22 8.97 6.91 - 60 S t e r l i n g CD's ( c o v e r e d ) ,, Lower Differential ii Upper Euro-S 3-month Deposits " 8.97 Local Authority Deposits (covered) " 7.22 Differential H Lower U.S. Treasury Bill rate * 9A U.K. Treasury Bill rate Local Authority Deposit (uncovered) 9B 9.SO 8.94 on Unadj. Euro-S Deposits 8B 9.94 Upper Lower 8A 9.63 Euro-$ 1-month Rate U.S. Certificate of Deposits 7B Rate Upper Lower -1.75 July 6 7.87 " 6.76 June 29 8.38 Spread (+= favor London) .. -1.11 ' 3-month Forward Pound " -2.36 " -3.47 Net Incentive (+- favor London) IV- 4 Chart Panel Series 10A Upper Euro-$ Deposits (covered) Lower 10B Upper Rate Date July 4 German Interbank Loan rate „ Differential ,, Euro-$ Deposits (covered) H Swiss Deposit rate 11 , Lower Differential Upper Canadian Finance Paper 5.10 14.25 +9.15 2.44 2.50 +0.06 July 6 7 95 U.S. Treasury Bill rate Canadian Treasury Bill rate 5.47 U.S. Prime Finance paper (not plotted) Second 12A 7.63 Bill rate differential " Forward Canadian dollar ii +1.70 +1.32 -2.40 Third Net incentive on bills Bottom Net incentive on Finance Paper M Upper U.K. Treasury Bill rate II U.S. Treasury Bill rate • II 7.87 II 14.25 -0.70 German Interbank Loan rate Lower Japanese Average rate Canadian Treasury Bill rate U.S. Treasury Bill rate 12B 6.76 Apri 1 6.756 July 6 5.47 • - 7.87 Euro-S Deposits " 9.81 Swiss 3-month Deposit rate " 2.50 " 7.87 U.S. Treasury Bill rate n$s \ IV-5 Chart Panel Series 13 Upper Netherlands Date Canada * United States Switzerland Germany Middle United kingdom U.S. Corp. Dollar Lower E u r o "bond|eries U.S. Corp. DM Euro-bonds U.S. Corp. Aaa bonds 14 Switzerland Upper Germany United States United Kingdom Middle Canada Lower ** Japan United States . G Rate June 29 June 27 7.74 June 29 6.93 7.83 June 15 S.3S June 22 9.89 June 29 10.33, April ' April 8.02 6.86 May 7.29 J ul y 6 380.5 June 27 287.2 July 6 231.63 June 28 274.14 June 30 817.86 July 6 231.63 II 240.83 * N e w — A v e r a g e y i e l d o n s e l e c t e d 10 y e a r c o n s t a n t m a t u r i t y b o n d s d u e o r c a l l a b l e i n 10 y e a r s . * * Beginning week ended September 5, 1970, the Japanese index plotted is that of a l l industrial and other stocks on the F i r s t Section of the Tokyo Stock Exchange.
@FedFRASER