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DIVISION C INTERNATIONAL FINANCE BOARD FEDERAL 3 M a r c h No! 290 OF GOVERNORS RESERVE SYSTEM 15 1967 ' ' CAPITAL MARKET DEVELOPMENTS ABROAD 1. II. III. I. Canada: Canada Ten Charts on Financial Markets Abroad Latest Figures Plotted in H. 13 Chart Series, 1967 Money and Capital Markets, September 1966-February 1967 Since September, easing demand pressures in the Canadian economy and falling interest rates in foreign capital markets have contributed to a significant casing of financial conditions in Canada. Interest rates are substantially below those prevailing last summer. Money rates and bond yields moved irregularly during (See Table 1.) October and November, and declined sharply during December and January. Bond rates remained largely unchanged during February, but short-term interest rates have continued to decline. Between late September and early March, the more-liquid asset ratio of the chartered banks has increased from 30.0 per cent to 31.1 per cent of deposits. Table 1. Canada: Selected Financial Market Indicators September 1966-March 1967 (interest rates and forward exchange rates in per cent per annum) Level on: 1966 9/22 Change from Previous Period to: 1966 1967 1/4 3/2 2/16 11/23 10/26 Level < 1967 3/2 Interest rates Day-to-day loans. 78 H/ ^ 90-day prime finance pa per-/ 6,. 38 91-day Treasury bills— 5,.01 Government bonds— 4.25 per cent 6/67 5,.48 5.00 per cent 1968 5,. 74 4.25 per cent 1972 5..85 ^.50 per cent 1983 5.,83 5.25 per cent 1990 . 5. ,88 +., 37 +., 18 -.08 - . 25 .05 -.22 0 -.20 -.08 -.50 -.33 -.15 -.13 -.13 4.50 5.88 4.48 .11 -. 20 12 07 14 -• +,. 23 30 31 +..25 +., 23 -.67 -.40 -.39 -.27 -.30 -.17 -.27 -.15 -.13 -.06 -.05 -.30 -.09 -.11 -.07 4. 71 4.81 5.41 5. 59 5.54 e/ Stock index- - + + 1 + 13 + 1 162 -.03 -.39 +.17 -.32 -.15 +. 34 92.43 +.04 Canadian dollar Spot (U.S. cents) 3-month forward a/ b/ 6/ 145 52. 91 39 +., 25 1 29 11 +,. +., 3 18 +. 13 Average of daily closing rates for week ending Wednesday. Friday data. _c/ Average tender rate, Thursday data. Wednesday data; mid-market yields at close. e/ Financial Times, Toronto Industrials. OFFICIAL USE ONLY after six months) (Decontrolled OFFICIAL USE ONLY - 2 - Trends in Canadian financial markets paralleled similar trends in the U.S. markets, but the dominant cause has been a major shift in the focus of monetary and fiscal policy wiuh increasing evidence of a decline in demand pressures throughout the economy. Key indicators of industrial activity have suggested since summer that the economy was no longer pressing against capacity constraints and this easing was confirmed by the absolute decline in seasonally-adjusted real output found in the third quarter GNP data* As a result, there has been a gradual easing of Canadian fiscal and monetary policy. The Finance Minister's interim budget, first promised in August as an anti-inflationary measure, finally emerged in December as neutral on aggregate demand; taxes were raised only to cover certain additions to welfare payments commencing in January 1967. In mid-March, the Canadian Government took the further step of suspending a refundable tax on corporate profits. The 5 per cent tax on profits and depreciation was imposed last May in order to restrain corporate investment. At that time, officials stated that it would be refunded when inflationary pressures had calmed and investment could again be encouraged. However, the recent action was only a suspension of further collections: no decision has been made to refund past taxes. A gradual easing of monetary policy was marked by a reduction in the Bank of Canada discount rate from 5-1/4 to 5 per cent on January 30 which was to be regarded as "the Bank's view that the recent easing of credit conditions was appropriate to Canada's domestic economic circumstances and its external financial position." Bank loans grew less rapidly during the second half of 1966 than in the same period of 1965. During the summer months, the growth of loans was constrained by extremely tight monetary conditions; during the last months of 1966, however, the demand for banks loans apparently eased and the liquidity position of the banks improved considerably. The stringency of capital market conditions in Canada and the U.S. during most of 1966 was reflected in a reduced volume of money raised by the private sector. Net new private debt and equity issues declined slightly in the Canadian market, , and receipts from issues in the U.S. market were down sharply. Despite higher interest costs, however, various levels of Canadian Government raised more money in Canadian and U.S. markets in 1966 than in 1965. In exchange markets, the spot Canadian dollar weakened during the fall, declining from U.S. 92.91 cents in late September to U.S. 92.41 cents near the end of the year. It went through a temporary recovery during January, but remains below par. The forward rate moved from a premium to a discount early in 1967, and is now about flat. The decline in Canadian foreign exchange reserves stopped temporarily between October and January. Reserves declined during February and are now $117 million below the level of last June. (See Table 7.) OFFICIAL USE ONLY - 3 - OFFICIAL USE ONLY Bond yields decline since November Easier credit conditions in Canadian markets from November on produced yield decl ines over a vide range of issues., (See Table 2.) After remaining largely unchanged during September and October, bond rates rose slightly in November before beginning the sharp decline of the next two months. Despite the recent declines, however, bond yields at the end of January were still approximately 1/2 of 1 per cent above the levels of a year earlier. Yields on provincial bonds rose somewhat more rapidly than did others during the early fall, but also fell more rapidly later, and the structure of rates for various types of bonds did not shift noticeably over the period. Press reports have commented on the fact that Quebec bonds have been selling for somewhat higher yields than other provincials, and this has been attributed to French-Canadian political activity and to the heavy borrowing schedule of the Province. Table 2. Canada: Provincial, Municipal and Private Bond Yields 1966-67 (per cent per annum) Level Aug. 31 Change Sept. 30 Oct. 31 Previous Date to: Jan. Nov. 30 31 Level Jan. 31 6.25 10 Provincials 6.54 -.03 +.08 +.05 -.39 10 Municipals 6.80 0 -.08 +.02 -.23 6.51 10 Public Utilities 6.69 -.02 0 +.06 -.28 6.45 10 Industrials 6.83 0 -.02 +.09 -.25 6.65 40 Bond s 6.72 -.01 -.01 +.05 -.29 6.46 Source: McLeod, Young and Weir* Canadian yield declines follow U,S. trends The recent decline in Canadian bond yields lagged behind a similar decline in the United States. Bond rates in this country fell between September and November while Canadian yields were still rising, and U.S. yields fell more rapidly than did comparable Canadian yields during early December. (See Table 3.) As a result, yield differentials favoring investment in Canadian bonds rose considerably between September and December. These increases occurred over the full range of maturities, but were OFFICIAL USE ONLY OFFICIAL USE ONLY particularly noticeable at the short end. During late December and January, however, the declines in Canadian rates accelerated, while the U.S. fall was slowing, and the differentials narrowed; the differentials favoring Canadian bonds have remained above their September levels except for the longest maturities. Table 3. 1/ Canada/U.S.: Comparative Bond Yields,—' September 1966-February 1967 (per cent per annum) Sept. 22 19 6 6 Nov. 23 Dec. 21 1 -Year: U.S. 11/15/67, 3.62 per cent Canada 6/1/67, 4.25 per cent Differential (+ favors Canada) Jan. 4 19 6 7 Jan. 25 4.49 4.93 .44 4.67 4.86 .19 4. 64 4. 76 4.78 5. 65 .87 4.70 4.76 5.50 . 74 Feb. 22 .12 2 -Year: U.S. 8/68, 3.75 per cent Canada 10/68, 5.0 per cent Differential 7 -Year: U.S. 8/72, 4.0 per cent Canada 9/72, 4.25 per cent Differential 18-Year: U.S. 78-83, 3.25 per cent Canada 9/83, 4.5 per cent Dif ferential 25-Year: U.S. 2/90, 3.5 per cent Canada 5/90, 5.25 per cent Differential 4.88 5.83 .95 4.83 5.96 1.13 4.64 5.91 1.27 4.55 5. 74 1.19 4.46 5. 64 1.18 4.62 5. 71 1.09 4.81 5.88 4.83 5.91 1.08 4.61 5.87 4.51 5.71 1.08 4.46 5.60 1.14 4.58 5.62 1.04 1.26 1.20 1/ Canadian bonds, mid-market yield at close; U.S. bonds, yields on the bid side. Source: Federal Reserve System; Bank of Canada, Weekly Financial Statistics. OFFICIAL USE ONLY OFFICIAL USE ONLY Issue activity rises The three levels of Canadian Government raised more than twice as much new money in capital markets in 1966 than in 1965, despite the rise in interest rates. (See Table 4.) The private sector, however, was apparently more seriously affected by the scarcity of credit, and raised somewhat less in 1966 than in 1965. Private issues in the Canadian market fell slightly, but issues by Canadian businesses in the U.S. dropped by over one-fifth. Due to the large growth of government flotations 5 the total amount of money raised by Canadians grew in both U.S. and Canadian capital markets. Table 4. Canada; Net New Issues, 1965-66 (millions of Canadian dollars) Net New Issues: Canadian Funds Government of Canada Provincial and -368 -158 - 83 563 47 226 190 3 264 672 360 -38 -11 497 .44 392 - 124 816 1,128 83 151 87 100 421 127 543 37 916 1,549 -212 -174 12 807 435 313 371 268 374 1,326 214 145 75 -17 417 315 345 355 1,154 2,169 115 197 45 121 478 430 542 400 1,275 2,647 Corporate and Other Total Debt Equity Shares 1965 III Q Total III Q Total 186 Net New Issues: Government of Canada Total Other Currencies Provincial and Municipal Corporate and Other 21 132 81 40 2 74 19 40 157 118 334 Total Debt Equity Shares 40 169 238 155 602 85 339 477 156 1,057 385 258 98 69 -8TTT 384 486 197 69 1,1:46 1966 I Q 128 256 II Q 186 42 III Q 71 27 IV Q 35 37 Total "7T2TT ZbZ forSource: FRASER ank of Canada, Statistical Summary. Digitized OFFICIAL USE ONLY - 6 - Growth of bank loans declines During the second half of 1966, chartered bank loans grew by only 3.8 per cent, compared to 8.2 per cent during the same period in 1965. (See Table 5.) This contrast reflected the differing liquidity positions of the banks in the two periods. In the middle of 1965, the banks were in a position to expand loans by reducing the proportions of their assets held in liquid and near-liquid assets. In June of 1966, in contrast, the liquidity position of the banks was strained, and this process of loan expansion was not possible. The "more-liquid asset ratio" of the banks w a s below its normal minimum of 30 per cent in June of 1966, but improved during the next six months. The excess of the banks' liquid-assets over the minimum in December (1966) suggests that perhaps loan demand was not as pressing as it had been earlier in the year. Recent weekly figures indicate that loan growth has generally remained soft during early 1967 despite increasingly easy monetary conditions. The widely-reported easing of expansionary pressures in the Canadian economy may be reducing the demand for business loans. Table 5. Canada: Selected Banking and Money Supply Data, June 1965-December 1966 (millions of dollars) 1 S u 5 1 9 6 6 June Dec. June Dec. 2, 789 3,651 10,918 3,027 3,529 11,811 3,123 3,551 1^,065 3,420 3,486 12,550 Liquid assets r a t i o ^ More liquid assets ratio^ 16.40 30.71 16. 79 29.78 17.01 29.31 17. 36 30.38 Selected liabilities Demand deposits^/ Personal savings Other deposits!/ 4,527 9,330 2,153 4,779 9,642 2,303 4,751 10,042 2,472 5,195 10,140 2,480 13,857 2,198 16,055 14,421 2,351 16,772 14,793 2,351 17,144 15,335 2,495 17,830 Selected assets:—/ Liquid assets*?/ Investments^ Loans^/ Money supply of the public: Chartered bank deposits!}/ Currency outside banks Total a/ b/ c/ d/ e/ f/ / #/ Average of Wednesday reporting dates, Bank of Canada, Statistical Summary. Cash reserves, day-to-day loans and Treasury bills. Government of Canada bonds and "other" Canadian securities Excluding day-to-day and call loans. Daily averages. Less float. Non-personal term and other notice deposits. Demand and personal savings deposits less float. OFFICIAL USE ONLY - 7 - OFFICIAL USE ONLY Chartered banks increase U.S. dollar assets During the fourth quarter, the chartered banks expanded their holdings of U.S. dollar assets more rapidly than their U.S. dollar liabilities; consequently, the banks developed a net position in U.S. dollars of $168 million by December, (See Table 6.) This contrasts with the banks' apparent practice in the recent past of maintaining a roughly balanced U.S. dollar position. During most if 1966, Canadian banks increased their U.S„ dollar loans to foreigners at a rapid rate, and encouraged Canadians to maintain U.S. dollar deposits in order to finance these loans. During the fourth quarter, however, loans to foreigners grew particularly rapidly, and the U.S. dollar deposits of Canadians declined. Consequently the banks developed a sizable net U.S. dollar position. Table 6. Canada; United States Dollar Assets and Liabilities of Chartered Banks, March-December 1966 (millions of U.S. dollars) July Sept. Nov. Dec. 1,592 842 " ':34 915 3,349 +111 - 03 +108 - 26 + 82 + - 21 31 52 19 33 +187 +132 +319 + 85 +404 + + + + 842 1,186 2,028 1,293 3,321 + 16 - 54 - 38 +146 +108 -149 - 14 -163 +105 - 58 + 32 +210 +242 + 57 +299 - 32 +122 + 90 - 94 4 - of March With residents of; United States Other countries Sub-total Canada Total Liabilities With residents of 1 United States Other countries Sub-total Canada Total Source : Bank of Canada, Statistical Summary. OFFICIAL USE ONLY 95 3 98 58 40 Level December 1;,964 935 2,, 8 9 9 935 3., 8 3 5 710 1,,449 2,,159 50 7 3,,667 1, OFFICIAL USE ONLY - 8 - Foreign exchange reserves decline Canada's foreign exchange reserves continued their downward trend through the summer, but recovered slightly between October and January, before falling again in February. ' (See Table 7,) Some of the earlier reserve decline resulted from government transactions which were intended to reduce reserves to the $2,6 billion maximum which had been agreed upon with the United States in exchange for exemption from the interest equalization tax; in July, the Bank of Canada purchased $31 million in U.S. held Canadian Treasury securities for this purpose. The recent declines, however, have gone well beyond this goal, and Canadian reserves are now $122 million below the $2.6 billion target, Table 7, Canada; Official Foreign Exchange Holdings and International Monetary Fund Positions June 1966-February 1967 (in millions of U.S. dollars) Level June 30 Change from Previous Period to; Au "* 1 Oct, 31 Dec. 31 Jan. 31 Level Jan. 31 Level Feb. 28 Foreign Exchange Gold U.S. dollars Sub-total 1,024.2 1,317,6 2,341.8 -27.5 -33.3 -60,8 +23.8 -81.6 -57,8 +25.1 -12,4 +12.7 n.a. n.a. +2.3 n.a. n.a. -44.0 n.a. n. a. 2,194.2 IMF Position Super gold t r a n c h e ^ Total 253. 3 2,595.1 + 8.5 -52.3 +10. 3 -47.5 - 8. 6 +4.1 +20.5 +22.8 0 -44.0 283.5 2,477. 7- 0 0 0 n.a. n. a. Gold with IMF 185„ 0 n.a. a/ Net IMF sales of Canadian dollars; (+) indicates increased creditor position with IMF, Source; Bank of Canada, Statistical Summary, IMF, International Financial Statistics Exchange rate weakens The spot rate for the Canadian dollar declined from 93.01 to 92.25 U.S. cents during the period from September to November, and was below par during the last two months of 1966. (See Table 8,) A partial recovery during January was followed by another decline, and the rate was still below par in mid-March. The forward Canadian dollar was at a premium when the spot rate was falling, went to a discount during the short recovery. and is now about flat - OFFICIAL USE ONLY - 9 - OFFICIAL USE ONLY The causes of the decline are not completely clear, but the sharp reduction of U.S. flotations of Canadian securities during the fourth quarter of 1966 was undoubtedly an important factor. (See Table 4.) Apprehension about the 1967 prospects for U.S. business s and hence for Canadian exports of industrial raw materials, may have further encouraged softness in the Canadian dollar. There has been no clear trend in the interest arbitrage on Treasury bills during recent months; when the forward Canadian dollar was at a discount during January and February, there was a margin favoring U.S. bills, but this was ended by the recent recovery of the forward rate, A sizable interest rate differential has maintained an arbitrage margin in favor of Canadian finance paper. The considerably higher rates on Canadian finance paper, in a period when Treasury bill rates in Canada and the U.S. have been roughly equal, has been caused by investor nervousness brought about by the failure of two large Canadian finance houses during the recent past, and by continued press comment about the problems of other financial concerns. Table 8. Canada/U.S, : Exchange Rates and Arbitrage Calculations September 1966-March 1967 Sept. 2 Oct. 19 18 Exchange rates Spot (U. S. cents) Forward (p.c.p.a.) 93,.01 ,09 92 , 65 . 44 90-day yields and differentials: Treasury bills Canadian U.S. Gross advantage Canadian forward—' Net, favor Canada (+) 4.,89 5..04 . 15 09 - • 06 - =, 41 6. 25 63 62 09 71 6. 25 5, 75 50 45 95 Finance paper Canadian U.S. Gross advantage, Canadian forward-^ Net, favor Canada - (+) 4.,98 5,, 39 45 .04 a/ .11:00 a.m. data. Source : Federal Reserve System. Prepared by: Robert M. Dunn. Economist Europe and British Commonwealth Section Division of International Fin."nee OFFICIAL USE ONLY 30 Dec. 30 19 Jan. 31 92,„ 25 . 33 92., 2 8 . 15 92 . 73 .45 92 .43 0 5.,01 5,, 15 4,, 8 3 4., 79 04 15 19 4,.51 4,.46 .05 - . ,45 - -.40 - .02 , 6. 50 5. 88 62 15 77 6. 13 5. 25 88 - .45 43 6 6 Nov. - . , 14 , 33 , 19 6. 38 5. 88 50 33 83 6 7 Mar. 3 4.. 37 4,. 35 - 0 ,°2 • 6. 13 5. 13 1.00 0 1.00 w NEW YORK, LONDON, MONTREAL: YIELDS FOR U.S. DOLLAR INVESTORS ON 3 - M O N T H FUNDS DOLLAR DEPOSIT RATES: NEW Y O R K - L O N D O N EURO-DOLLAR DEPOSIT — U . S . CERTIFICATE OF DEPOSIT EURO-DOLLAR OVER | U.S. CERTIFICATE OF DEPOSIT . 1 A 1 / V ^ i i FINANCE Friday figure* CO. i . 1 1 V J I l L i 1 PAPER i r ^ l RATES i i (covered): 1 I T QUOTED 1 1 1 IN^NEW 1 1 1 1 YORK U.K. HIRE PURCHASE CANADIAN FINANCE COMPANY | U.S. FINANCE COMPANY Nat JHR. SI p t 1915 • ic~ rsTptT DEC. /l 1 1 1 \ V LONDON: YIELDS EURO-DOLLAR Friday figures FOR DEPOSIT U.S. DOLLAR INVESTORS ON 3 - M O N T H FUNDS RATES p er 30 180 DAY A DAY cenl i \ I ! Aa 9 0 D A Y A y ; CALL : | 1 I , i 1 i i 1, 1 11 HIRE PURCHASE AND LOCAL AUTHORITY HIRE DEPOSIT (covered) PURCHASE EURO-DOLLAR 1 RATES DEPOSIT DIFFERENTIAL FAVOR HIRE PURCHASE ! i i v . \y j i 1 , : l i . i EURO-DOLLAR : , , _j i i i ^ DEPOSIT i ^ LOCAL AUTHORITY i 1 ! ; DEPOSIT | I FAVOR LOCAL AUTHORITY I ; V 1966 i ; DIFFERENTIAL 1965 1 ; ! r i FAVOR EURO-DOLLAR : i i 1 ; , I ! | ! , FAV0R 1967 i , EURO DOLLAR ' I INTEREST ARBITRAGE: F R A N K F U R T / L O N D O N , Z U R I C H / L O N D O N FRANKFURT INTERBANK LOAN RATE VS. LONDON EURO-DOLLAR INTERBANK RATE (COVERED) I LOAN RATE IN TERMS OF DM j EURO-DOLLAR DIFFERENTIAL FAV.OR FRANKFURT j FAVOI EURODOLLAR ZURICH DEPOSIT RATE VS. LONDON EUKQ.DOLLAR RATE (COVERED) IN I OF TERMS ! SWISS FRANCS i [EURO-DOLLAR / ^ " J V ; ! SWISS DEPOSIT x v ~ I RATE i : i DIFFERENTIAL H PRICE OF G O L D FAVOR ZURICH IN LONDON j | V INTEREST ARBITRAGE, UNITED STATES/CANADA 3-MONTH TREASURY BILL RATES CAN. FIN. CO. PAPER CANADA UNITED STATES BILL RATE D I F F E R E N T I A L AND FORWARD CANADIAN DOLLAR PREMIUM SPREAD IN FAVOR OF CANADA FORWARD RATE I DISCOUNT 3-MONTH COVERED RATE DIFFERENTIALS (NET INCENTIVES) /FAVOR CANADA PRIME FINANCE PAPER I FAVOR J FAVOR U.S. CANADA TRIAS MY BILLS FAVOR 1184 1*5 **# 1167 U.S. ~ ChoM 5 I INTEREST ARBITRAGE, NEW Y O R K / L O N D O N Per cent per onnum 3-MONTH TREASURY BILL RATES U . K . LOCAL AUTHORITY D E P O S I T S i LONDON /V NEW YORK RATE DIFFERENTIAL AND 3-MONTH FORWARD STERLING SPREAD IN FAVOR OF LONDON PREMIUM FORWARD RATE RATE DIFFERENTIAL WITH FORWARD EXCHANGE COVER •V") (NET INCENTIVE) IN FAVOR OF LONDON IN FAVOR OF NEW YORK 1965 1966 1967 . V " c,„ , SHORT-TERM INTEREST RATES * U.K. EURO-DOLLAR - LONDON US- SWITZERLAND JAPAN GERMANY CANADA I A ' U.S. 1962 1963 Switzerland (3 mon h deposit roIe)j and Germany j 3 month rate tor US dollar deposits in London 1964 (interbank Loan Rate) T965 1966 L O N G - T E R M B O N D YIELDS Weekly figures NETHERLANDS CANADA SWITZERLAND GERMANY EURO DOLLAR BONDS*! X\ US 1963 1964 1965 Average of yields for four foreign government dollar bonds quoted in London New series for Germany starts 7-9-65 1966 1967 SPOT E X C H A N G E RATES - M A J O R CURRENCIES AGAINST U.S. DOLLAR SWISS FRANC 1.2 GERMAN MARK U.K. STERLING FRENCH F R A N C BELGIAN FRANC, DUTCH GUILDER CANADIAN DOLLAR ITALIAN LIRA JAPANESE YEN s M 1965 D M J 1966 S D M 1967 J 3 - M O N T H FORWARD EXCHANGE RATES AGAINST U.S. DOLLARS —NEW YORK Fndoy figures Per cent per annum PREMIUM | G E R M A N MARK . SWISS FRANC ! V POUND STERLING DISCOUNT- T 2 PREMIUM* DUTCH GUILDER FRENCH FRANC CANADIAN DOLLAR DISCOUNT- AG AI N ST POUND STERLING — L O N D O N , Friday figures SWISS FRANC . r /, GERMAN MARK U.S. DOLLAR OISCOUNT- J s 1964 D M J 1965 S D M S 1966 D I N D U S T R I A L STOCK I N D I C E S i 30Q f • • ^ — • 1 - 320 SWITZERLAND ! GERMANY ii i r i i i M i i i i i i i i i i i i i i i i i i i i i 120 360 320 280 JAPAN 240 200 CANADA 160 120 1964 1965 1966 1967 H. 13 No. 290 Latest Figures Plotted in H.13 Chart Series, 1967 (all figures per cent per annum) Chart 1 Chart 5 (Friday, March 1() Euro-$ deposit 5 56 U.S. certif. of deposit 5.. 13 Lower Panel (Friday, March ) 10 y, 00 D. 56 5 64 Finance co. paper: U.S. Canada Hire-purchase paper, U.K. Chart 2 (Friday, March Treasury bills: +1.40 Forward pound -0. 80 Net incentive (U.K. + ) +0. 60 Chart 6 (Friday, Mar. 90-day 180-day ' 5 62 Hire-purchase paper (March 3) 5 52 Local-authority deposit (March 3) Upper Panel Chart 3 (Period: March 1-7 J Interbank loan (mid-point) ^ 18 Euro-$ deposit (average) 5.48 Lower Panel (Date: February 15 ) Zurich 3-month deposit Price of gold (Friday, March 3 10) 10 ) Treasury bills: 3 38 5.62 5.73 4. 33 U.K. U.S. Spread favor U.K. Euro-$ deposits: Call 30-day March 15, 1967 4 50 3 :> 15 U.S. U.K. Canada 4. 33 5.73 4. 24 Interbank loan rate (German) (March 1-7) 5-18 Euro-$ deposit (London) 5. 56 Zurich 3-month deposit (Date: February 15 Japan compoeit rate (Date: | N o v e m b e r 30 ) 4. 50 ) 7. 39 Chart 7 U.S. Gov't. (Wed. , March 8 ) U.K. War Loan (Thurs. , March 9 ) German Fed. (Fri., March 10 4.52 6. 43 ) 7. 19 Swiss Confed. (Fri., March 10 ) 4. 26 ) Canadian Gov't. Chart 4 (Friday, March 10 ) Canada U.S. Spread favor Canada 4, 33 - 0 09 Forward Canadian $ + Net incentive (Canada + ) + 0 06 5.51 Netherlands Gov't, perpetual 37. (Friday, March 3 ) 5. 66 Euro-$ bonds (Fri. , March 10 6. 30 4- 24 Treasury bills: Canadian finance paper (Wed. , March 8 ) 0 15 5 50 ) For descriptions and sources of data, see special supplement to H.13, Number 239, March 16, 1966.
@FedFRASER