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May 18, 1962
H.13
tigyrAL
MARKET DEVELOPMENTS ABROAD
I , Canada
IIo Nine Charts on F i n a n c i a l Markets Abroad
I . Canadas
Money and C a p i t a l Markets during April
Continued s a l e s of Canadian d o l l a r s i n t h e f o r e i g n exchange
market during April culminated on May 2 i n the adoption by Canada of a
f i x e d exchange r a t e of 92.5 U, So cents f o r the currency„ The r a t e was
held during A p r i l a t around 95-1A U, S, c e n t s by means of heavy o f f i c i a l
support operationso Sales of U. S, d o l l a r s by the Exchange Fund amounted
t o (U, So) $1114. m i l l i o n i n A p r i l and o f f i c i a l reserve l o s s e s i n t h e f i r s t
f o u r months of t h i s year t o (Uo So) $U60 m i l l i o n 0 The decision t o s e t a
par v a l u e , taken with the approval of t h e I n t e r n a t i o n a l Monetary Fund,
brought t o an end t h e Canadian experiment with a f l u c t u a t i n g exchange-rate
p o l i c y i n i t i a t e d i n 1950,
Canadian short-term money r a t e s moved up sharply i n e a r l y May
a f t e r t h e new par value was announced. At 3»2lj. per cent on May 10, t h e
Canadian Treasury b i l l y i e l d was a t t h e h i g h e s t p o i n t i n nearly twelve
months, In t h e bond market, y i e l d s continued t o d r i f t - downward i n l a t e
A p r i l and e a r l y May. The average y i e l d f o r 1*0 p r o v i n c i a l and corporate
bonds eased ftfom 5»25 per cent on March 30 t o 5o22 per cent on A p r i l 30,
the lowest average y i e l d since February 1959»
The r i s e i n Treasury b i l l r a t e s r e f l e c t e d i n p a r t s u b s t a n t i a l
s a l e s by the c h a r t e r e d banks t o f i n a n c e t h e i r r e c e n t loan expansion0
Government d e p o s i t s rose f u r t h e r by $21*2 m i l l i o n i n t h e f i r s t week i n May
t o a record peak of $986 m i l l i o n on May 9« Receipts of Canadian-currency
from s a l e s of f o r e i g n exchange undoubtedly c o n t r i b u t e d t o t h e r e c e n t growth
i n t h e s e Treasury b a l a n c e s . Since the a u t h o r i t i e s w i l l have t o be i n a
p o s i t i o n t o f i n a n c e reserve a c c r u a l s , i t i s l i k e l y t h a t the Treasury
balances may be maintained a t a higher l e v e l than has been the p r a c t i c e i n
the p a s t decade, Since the bulk of r e c e n t Treasury deposit a c c r u a l s have
been r e t a i n e d a t t h e c h a r t e r e d banks, they have not immediately a f f e c t e d
commercial-bank r e s e r v e a v a i l a b i l i t i e s ,
Despite the r e c e n t expansion i n bank l o a n s , the Canadian business
t r e n d s remain mixed. Even though Canadian observers expect an i n c r e a s e i n
gross n a t i o n a l product of about 6 per cent t h i s y e a r , some continued
slackening i n business expansion i s recorded i n s t a t i s t i c a l i n d i c a t o r s f o r
t h e f i r s t q u a r t e r . Seasonally-adjusted i n d u s t r i a l production was a t 180.7
i n December 1961 and a t 180,5 i n February, A f t e r a pause i n February,
i n d u s t r i a l employment r e g i s t e r e d f u r t h e r gains i n March and unemployment
declined from 6.0 t o 5.8 per c e n t . R e t a i l t r a d e declined f r a c t i o n a l l y i n
February,
NOT FOR PUBLICATION
DECONTROLLED AFTER SIX MONTHS
. NOT FOR PUBLICATION
- 2 -
S i n c e i t s s t a b i l i z a t i o n on May 2 9 t h e Canadian d o l l a r has b e e n
under s e l l i n g p r e s s u r e s and t h e s p o t r a t e has d e c l i n e d from 9 2 . 7 3 Uo So
c e n t s on May U t o 91=81 Uo So c e n t s on May 15» The f o r w a r d d o l l a r was
quoted a t a d i s c o u n t of 0.L3 p e r c e n t p e r annum on May 3 and of 0 , 3 1 p e r
c e n t on May l5o
Money m a r k e t . A f t e r d e c l i n i n g from mid-March t h r o u g h A p r i l ,
Canadian s h o r t - t e r m i n t e r e s t r a t e s moved upward i n e a r l y May0 The 3-month
T r e a s u r y b i l l remained around 3o0i- t o 3=10 p e r c e n t from A p r i l 5 t o A p r i l 26
b u t moved t o 3»19 p e r c e n t on May 3 and 3 = 2b. p e r c e n t on May 10 (See Table
, and C h a r t 1)» The 6-month b i l l r a t e moved more n a r r o w l y ; i t was 3.30 p e r
c e n t on A p r i l 5> 3 = 35 p e r c e n t on May.3> and 3»38 p e r c e n t on May 1 0 D a y t o - d a y was a t 3o20 p e r c e n t on A p r i l Us b u t t h e r a t e remained unchanged a t
3»00 p e r c e n t f o r t h e r e m a i n d e r of A p r i l and t h e f i r s t two weeks i n May*
I n A p r i l , t h e Canadian c h a r t e r e d banks a c c e l e r a t e d t h e i r s a l e s
of T r e a s u r y b i l l s » T h e i r s a l e s of $106 m i l l i o n d u r i n g t h e month (See t a b l e )
were matched by p u r c h a s e s by t h e g e n e r a l p u b l i c ($U2 m i l l i o n ) 5 by t h e Government a c c o u n t s ($50 m i l l i o n ) , and by t h e Bank of Canada ($1U m i l l i o n ) » Net
s a l e s of o t h e r s e c u r i t i e s r e p r e s e n t e d i n p a r t t h e redemption of an o u t s t a n d i n g m a t u r i t y i n c o n n e c t i o n w i t h t h e r e f u n d i n g o p e r a t i o n announced on A p r i l 11
and summarized i n t h e p r e v i o u s r e p o r t 0
The i n c e n t i v e i n f a v o r of t h e Canadian T r e a s u r y b i l l a g a i n s t t h e
Uo So b i l l was r e d u c e d f r o m 0 . 3 7 p e r c e n t tin March 29 t o 0»17 p e r c e n t on
May 10 s l a r g e l y b e c a u s e of t h e s u b s t a n t i a l d i s c o u n t on t h e f o r w a r d Canadian
d o l l a r i n l a t e A p r i l and e a r l y May, (See T a b l e and C h a r t 1 . )
However, t h e s p r e a d i n f a v o r of Canadian f i n a n c e p a p e r widened
from 0 o l 2 p e r c e n t on March 30 t o 0»57 p e r c e n t on May 10 a s Canadian y i e l d s
r o s e . The wider d i f f e r e n t i a l s a r e r e p o r t e d t o have a t t r a c t e d some U.' S»
i n v e s t o r i n t e r e s t i n Canadian p a p e r . Comparative y i e l d s on 3 0 - t o - 8 9 day
p a p e r f o r l e a d i n g a c c e p t a n c e houses were ( i n p e r c e n t p e r annum)%
Canada
March 30
A p r i l 26
May 10
U. So
2.88=3,00
3.2S-3o$0
3o25-3=50
2,88
2.88-3.00
2.75-2.88
Spread
0.12
O.Wi
0.57
Bond marketo Canadian Government bond y i e l d s d e c l i n e d d u r i n g
A p r i l b u t t h e movement was r e v e r s e d i n t h e f i r s t two weeks i n May. (See
Table and C h a r t 6 . ) Recent Canadian y i e l d s (in p e r c e n t p e r annum) were:
196L
fey_
Jan. 31
Mar. 28
Apr. 25
May 9
3.75
3»5>8
3,k7
3.59
1975-78
(Jan.)
Lo98
L86
k.78
L.83
NOT FOR PUBLICATION
1983
(Sept.)
5.0k
Uo9U
k.87
It.91
NOT FOR PUBLICATION
- 3 -
In A p r i l , t h e spread i n Canadian over U, S. bonds d e c l i n e d i n i n t e r m e d i a t e
and long-term m a t u r i t i e s b u t w i d e n e d i n e a r l y M a y .
(See T a b l e , ) —
As i n March, heavy demand from i n s t i t u t i o n a l i n v e s t o r , combined
with a reduced volume of new o f f e r i n g s coming on t h e market, c o n t r i b u t e d
t o a continued d e c l i n e during A p r i l i n y i e l d s i n t h e p r o v i n c i a l and c o r p o r a t e
bond s e c t o r s . Y i e l d s on p r o v i n c i a l and c o r p o r a t e bonds d e c l i n e d from 5.25
p e r c e n t on March 30 t o 5-22 on A p r i l 30; t h i s marks t h e lowest l e v e l s i n c e
February, 1959.. According t o t h e monthly r e p o r t p r e p a r e d by Mcleod, Young,
Weir and Company, r e c e n t average bond y i e l d s were ( i n p e r c e n t p e r annum);
Feb. 28
10
10
10
10
hO
Provincial
Municipal
Public u t i l i t i e s
Industrials
Bond y i e l d average
5.31
5-5U"
5.23
5.28
5.3U
1962
Mar. 30
5.20
5<M
5.18
5.18
5-25
Apr. 30
5-19
5.38
5.17
5.15
5.22
According t o A.E. Ames & C o . , •$1,1U1 m i l l i o n of new s e c u r i t i e s
( e x c l u s i v e of r e g u l a r s h o r t - t e r m f i n a n c i n g ) were i s s u e d i n t h e p e r i o d ending A p r i l 2k; t h i s compares with new i s s u e s t o t a l l i n g $1,361 m i l l i o n i n t h e
comparable p e r i o d i n 1961. Of t h e new i s s u e s r e p o r t e d through A p r i l 2h,
$U.5 m i l l i o n i n c o r p o r a t e and municipal bonds were s o l d i n t h e U. S„ market.
Bank loans and t h e money supply. On a s e a s o n a l l y a d j u s t e d b a s i s ,
g e n e r a l bank l o a n s have been expanding s h a r p l y . In t h e f i r s t q u a r t e r of t h i s
y e a r , t h e y r o s e by .6.5 p e r c e n t compared with a year-ago i n c r e a s e of 2 p e r
c e n t . At t h e end of March, g e n e r a l bank l o a n s o u t s t a n d i n g were, a t a l e v e l
16 p e r c e n t above t h e end of March 1961. The money supply a l s o r o s e during
t h e q u a r t e r , although t h e i n c r e a s e of 1 . 9 p e r c e n t i s only moderately above
t h e expansion by 1 . 5 p e r c e n t l i n January-March 1961. Money supply a t t h e
end of March was 8.8 p e r c e n t g r e a t e r than on t h e same d a t e l a s t y e a r c
Although data on a comparable b a s i s a r e not y e t a v a i l a b l e f o r
A p r i l , i t would appear t h a t bank c r e d i t continued t o expand. The loan
expansion was supported i n p a r t by bank s a l e s of Treasury b i l l s and was
r e f l e c t e d i n some t i g h t e n i n g i n bank l i q u i d i t y . The average l i q u i d a s s e t
r a t i o of t h e Canadian c h a r t e r e d banks, which was 18.0 p e r c e n t i n both
February and March, d e c l i n e d t o 1 7 . 1 p e r c e n t i n A p r i l — s t i l l w e l l above
t h e r e q u i r e d minimum of 15 p e r c e n t . Throughout t h e p e r i o d , t h e cash r a t i o
was unchanged a t 8 . 1 p e r c e n t .
Operations of Canadian banks i n non-Canadian c u r r e n c i e s . I n
February, t h e r e t u r n flow of non-Canadian currency d e p o s i t s with Canadian
c h a r t e r e d banks continued — as i n January — b u t a t a much reduced pace*
(See T a b l e . ) This r e t u r n f l o w , r e v e r s i n g t h e l o s s of d e p o s i t s i n December
1961, brought t o t a l non-Canadian currency d e p o s i t s t o $3.9 b i l l i o n a t t h e
end of February, comparable t o t h e record l e v e l recorded a t t h e end of
November, 1961. I n March, however, non-Canadian d o l l a r d e p o s i t s d e c l i n e d
moderately — by $115 m i l l i o n — t o a t o t a l of $3«8 b i l l i o n .
NOT FOR PUBLICATION
NOT FOR PUBLICATION
h
-
-
" C a l l l o a n s " by Canadian banks i n t h e New York market showed
l i t t l e change i n March. E s t i m a t e s of t h e New York S t a t e Banking D e p a r t ment show r e c e n t t o t a l l o a n s t o s e c u r i t y d e a l e r s ( i n m i l l i o n s of U„ S,
dollars)?
I960
Deco
1961
Dec,,
Jan.
1962
Febo
Mar 0
1,U96
1,963
1,288
1,775
1,822
Foreign agencies
81#
829
881
823
875
Compare
Canadian a /
Other ( r e s i d u a l )
829
20
809
SO
786
95
7U3
80
78U
91
U. S . banks
__ C a l l l o a n s , a s r e p o r t e d by Canadian b a n k s , c o n v e r t e d i n t o U0 So d o l l a r s
a t end-of-month exchange r a t e .
Borrowings by m u n i c i p a l i t i e s . During 1961, borrowings by
m u n i c i p a l i t i e s i n c r e a s e d by $361 m i l l i o n compared w i t h r i s e s of $L79 and
$372 m i l l i o n s i n t h e two p r e c e d i n g c a l e n d a r y e a r s . T o t a l d e b t has i n c r e a s e d
f r o m $3,56U m i l l i o n i n 1958 t o $U,775> m i l l i o n i n 1961= The breakdown of
d e b t by p r i n c i p a l p r o v i n c e s i s ( i n m i l l i o n s of d o l l a r s ) %
Ontario
Quebec
Alberta
B r i t i s h Columbia
Other
Total
195&
1959
I960
1961
1,321
1,156
360
318
U09
3,56U
l,U52
1,263
h09
355
U56
3,935
l,60li
1,152
li39
Uoi
519
U,l»l5
1,722
1,609
U17
553
U, 775
No f i g u r e s a r e a v a i l a b l e on t h e volume of t h e s e borrowings p l a c e d i n U n i t e d
S t a t e s markets»
F o r e i g n t r a d e , Canadian t r a d e , s e a s o n a l l y a d j u s t e d , showed o n l y
minor d e f i c i t s i n J a n u a r y and F e b r u a r y . Recent t r a d e e s t i m a t e s (monthly
o r monthly a v e r a g e s i n m i l l i o n s of Canadian d o l l a r s ) have b e e n :
I
Exports
Imports
Trade b a l a n c e
II
li59.3
U56»7
- 2.6
1961
U73»5
Uk3°2
+30.3
III
IV
Jan,
SlUoU
L95.5
+18.9
520.3
518.9
+ loli
50U»7
507.5
-2.8
1962
Feb,
U95-5
508.6
-13.1
v"Foreign exchange. The a d o p t i o n on May 2 of a f i x e d r a t e of 92=5
U. So cgiits f o r t h e Canadian d o l l a r , ending t h e f l u c t u a t i n g exchange r a t e .
p o l i c y p u r s u e d s i n c e 1950, was t h e h i g h l i g h t of t h e month„ The l i k e l i h o o d
NOT FOR PUBLICATION
NOT FOR PUBLICATION
- 5> -
of some exchange r a t e move, p o s s i b l y a f t e r t h e Canadian e l e c t i o n s i n June,
had been widely a n t i c i p a t e d i n market c i r c l e s . The May 2 a c t i o n came
unexpectedly, however, and was a p p a r e n t l y motivated by t h e f e a r of continued
heavy r e s e r v e l o s s e s on t h e s c a l e experienced by t h e exchange a u t h o r i t i e s
throughout A p r i l .
The Canadian d o l l a r was under continuous p r e s s u r e throughout
A p r i l , when i t was h e l d a t around 95-l/U U. S„ c e n t s b y " o f f i c i a l s a l e s of
U. S # $111; m i l l i o n i n t h e m a r k e - t »
For the f i r s t
f o u r months t h i s y e a r , l o s s e s came t o $U60 m i l l i o n . This r e p r e s e n t s a
d r a i n amounting t o almost o n e - q u a r t e r of o f f i c i a l holdings of gold and Ue. S.
d o l l a r s a t t h e end of December 1961.
A f t e r t h e p a r vblue was announced, t h e r a t e d e c l i n e d from 92,73
Uo So c e n t s on May 3 t o a low of 91,81 U. S. dents on May 15:• Some w i t h drawal of funds from Canada by U. S. and C o n t i n e n t a l i n v e s t o r s was r e p o r t e d
i n t h e p r e s s . Recent changes i n Canadian r e s e r v e s ( i n m i l l i o n s of U. S.
d o l l a r s a t end-of-month):
1961
Dec.
Gold
U . S . dollars
Total
Jan.
Feb.
1962
Mar.
Aprn.a*
n&ao
916.2
1,109.6
9U9.6
.972.3
962.1
78U.3
963.7
7U5.7
' 2,055.8
1,921.9
1,716.7
1,709.1
1,595.0
- 133.9
- 175.2
-
- llluU
Change during
period
-
23.0
37.3
Throughout A p r i l t h e 3-month forward Canadian d o l l a r remained a t
a s l i g h t d i s c o u n t , which widened somewhat a f t e r t h e May 2 exchange r a t e
a c t i o n . Despite t h e wider spread i n y i e l d s between t h e Canadian and Uc S.
Treasury b i l l s , however, t h e i n c e n t i v e t o hold Canadian b i l l s (covered f o r
exchange r i s k ) i s c u r r e n t l y s t i l l below l e v e l s which o p e r a t e t o induce
any movement of f u n d s i n t o Canada.
Stock exchange. On b a l a n c e , Canadian i n d u s t r i a l stock p r i c e s
d e c l i n e d moderately i n A p r i l , d e s p i t e a s l i g h t r a l l y i n t h e t h i r d week of
t h e month, and again a t t h e beginning of May. The weekly average f o r t h e
index of i n d u s t r i a l stock p r i c e s on May 2 was 0 . 8 p e r c e n t below A p r i l k°
During the same p e r i o d the New York Standard & Poor i n d u s t r i a l index
dropped more s h a r p l y by l u 3 p e r c e n t .
N.Yo Standard & Poor
Avg. f o r week ending
DBS I n d u s t r i a l s .
Industrials
1962-Mar. 8
3U9.1
Apr. 5
339.7
26
337.2
May 3
339.1
Europe and B r i t i s h Commonwealth S e c t i o n •
73.9k
. 72,59
71.15
6 9 . Wt
I I o Nine Charts on F i n a n c i a l Markets Abroad
- 6 -
Canadag
Treasury B i l l Yields and Exchange Rates
3=mOo Treaso b i l l a r b i t r a g e c a l c u l a t i o n
In
3=mOo favor
Can.
UoSo
Differ- y
Canada
bill®/
ence
1961-High
Low
1962-Mar, , 15
22
2?
Apr, • 5
12
19
26
May 3
10
2.26
2.17
2.66
Oo68
=0.13
3,08
.73
3.10
75
72
73
73
73
2.73
0.35
OoUl
0.37
0.37
0.31
0.37
0o3U
0oU6
0.58
3c3U
3ol0
3.12
3.09
3=0U
3.07
3.19
3o2U
69
2.66
Spot
Can, $
(U.S.
cents)
0.U5 0.89
=0.56 -0,20
101.72
95.91
0,U2
95.33
95-31
95.28
95,23
95,30
95.23
95.23
?2 .78
92.52
+0.07
+0.13
0
0
-0.07
-0,19
-0,1?
-0,1*3
-0,31
0,51t
0,37
0.37
0,21*
0,18
0,15
0,03
0.17
Finance paperfV
90-179
days
30-89 days
3-1/8-lA
3-1/8-lA
3-lA
2-7/8 t o 3
2-7/8 t o 3
2-7/8 to 3
3-lA
3-lA
3-lA
3-lA
3-1/2
3-1/2
3-1/2
3-1/2
a / Thursday q u o t a t i o n s ,
~~
J / Spread between spot and 3-month forward r a t e i n per cent per annum. Discount
equals ( - ) .
;
c / Net of d i f f e r e n c e i n b i l l y i e l d l e s s discount on 3-month Canadian d o l l a r „
d / Friday q u o t a t i o n s .
Selected Government of Canada S e c u r i t y Yields
-mo. Treaso b i l l s
Spread
over
Canada
U0S0V
1961-High
Low
3.63
2.35
=0oll
Mar. 28
Apr . k
11
18 .
25
May 2
9
,29
.30
OoUl
0olt9
a/
b/
bill
c/
d/
e/
f/
j/
h/
.21
.30
.19
.35
38
lol5
0.39
0.U8
0.36
0.53
0.61
Intermediate
bonds (8 y r . )
Spread
over ,
Canada
UoSoj/
Long •term bonds
^ 2 0 year)
135 y e a r )
"
Spread
Spread
over/
Canada
ovej^
Canada
UoSoB/
5.19
Uo75
koll
1.16
OoOU
U08O
Loll
Uol2
Uol3
0.32
0.53
o,L5
o.U5
0oU0
0.U9
0.50
lo821.77
ho73
Uo7U
Uo7U
Uo77
U.06
UpOU
UoOU
Uo05
Uo82.
1.U0
0.78
5.23
b.92
1.59
1.1U
0.82
lt.91
li.91
1.23
0.92
0.85
0.83
O.83
0.86
0.91
U.88
U.86
It.86
It .86
li.SU
Average y i e l d a t weekly tender on Thursday.
"
"
Spread between Canadian a u c t i o n r a t e and composite market y i e l d of UoS»
on close of business Thursday.
Government of Canada 2-3/U per cent of June 1967-68.
Spread over UoSo Government 2=1/2 per cent of 1963-68.
Government of Canada 3 ° l A per cent of October 1979.
Spread.over UoSo Government 3 - l / U per cent of 1978=83.
Government of Canada 3-3/U per cent of September 1996 = March 1998.
Spread over UoSo Government of 1995.-
1.18
1.18
1.19
1.16
1.20
1.20
- 7 Canadai Changes in Distribution of Holdings of Canadian
Government Direct and Guaranteed Securities
(millions of Canadian dollars, par value)
Bank of Canada
Treas.
bills
Bonds
1961-April
May
June
July
Aug.
Sept.
Oct.
Nov,
Dec.
1962-Jan0
Feb.
Mar.
April
Source* Bank
Government
Total
Chartered banks
Treas.
bills
Bonds
+ 9
- 2
+ $9
- 70
.
+ 17
- 22
+ 63 '
- 1
+
2
+
33
+
13
- 7U
+ 16
+ 21
+ 16
• 69
+ 21
+107
0
+ 32
+ 16
+ 9
+ a
- 58
+ lk
+109
-105
- 39
+ 3
- Ii2.
-125
- 9
+ 21
+ 32
- U8
- 3
+ 88
+ U8
- 1 .
- 69
- 8
- k2
- 19
- a
+ 30
- 30
• 51
- 51
+ 1U
+ U6
-106
-117
of Canada, Weekly Financial Statistics*
General public
Savings Treas.
bonds bills
Bonds
- 52
+ 2k
+ 62
+ 11
•1U8
+ 72
+ k
+ #
+111
* 57
- k
• U3
- 23
- 37
- 33
- 22
- 23
7 29
~ 2h
+ h
+720
+ 2k
- 10
- k
- 13
- 17
+ 6U
=» 80
- 7
> 95
87
+ So
0
3
• U8
+ U7
« 20
+ 69
- 18
+ k2
+
+
+
+
-
12
1
37
37
35
U2
31
67
77
19
3U
87
31
Canadian banks: Non-Canadian Currency Assets and Liabilities
(in billions of Canadian dollars)
~
.
"
Deposits
Banks
Others Total
End of year
3.957
1958
1959
i960
1961
»3
ok
.5
.7
.7
1.5
1.7
1.9
2.0
2.8
End of Quarter
196H
I
II
III
IV
06
.6
.6
.7
End of month
19618 Oct.
Nov.
Dec.
1962s
Jan.
Feb.
Mar.
Assets
Deposits
Call
Securi- Other
with
banks
loans
ties
loans Total
1.8
2.1
2 .it
2.7
3.5
.U
o3
.U
.5
1.0
.6
.6
.7
.8
.8
ok
.5
.5
.6
.7
.5
.7
.8
.8
1.1
1.9
2.1
2.U
2.7
3*6
2.3
2.8
2.9
2.8
2.8
3.3
3.5
3.5
.6
.8
.9
1.0
.7
1.0
08
08
.8
.7
.9
.7
.7
.8
.9
1.1
2.8
3.3
3.5
3.6
o7
.7
.7
3.0
3.2
2.8
3.7
3.9
3.5
1.0 .
1.0
1.0
.9
.9
08
1.0
- o7
.8
.9
1,0
1.1
3.6
3.9
3.6
08
.8
.8
3.0
3.1
3.0
3.8
3.9
3.8
»9
o9
.9
08
08
1.1
1.2
.9
1.0
1.0
1.0.
3.8
3.9
3.7
—
08
INTEREST
ARBITRAGE,
UNITED
STATES / C A N A D A
Ith u r»d o v figures
1T H R E E - M O N T H
TREASURY
BILL
RATES
Kv-'V
rV/-/
'RATE
DIFFERENTIAL
AND
FORWARD
v
-Vy"^^-sy'
CANADIAN
DOLLAR
EXCHANGE
COVER
SPREAD IN FAVOR OF CANADA +
'
A
Y
RATE
' fOIWABD I ATI
A/
1Dlicoiet — j
DIFFERENTIAL
WITH
.
FORW&RD
NET INCENTIVE IN FAVOR OF CANADA +
9^(
INTEREST
ARBIT
^GE,
NEW
Y O R K / L O N D O N
3.MONTH TREASURY BILL RATES
RATE DIFFEISTTIAL AND
|
3-MONTH FCRWARD STERLING
fOIW ,"P BATE
RATE DIFFERENTIAL WITH
"FORWARD EXCHANGE COVER
IN
Of LEW v o l *
1
1961
INTEREST A R B I T R A G E FOR
GERMAN COMMERCIAL B A N K S
Fridoy figurei
3-MONTH
Pi
TREASURY
. EURO-DOLLAR
BILLS,
DEPOSIT
RATE D I F F E R E N T I A L
AND
INTERBANK
LENDING
RATE A N D
RATES
FORWARD
DEUTSCHE
MARK
/ V r v — i '
TBEASUBV litis
RATE
DIFFERENTIAL
WITH
FORWARD
EXCHANGE
NfT INCENTIVE:.
INTERBANK LOAN RATE
D
rNol«: Special forward 'role available 10 German commercial bonki
COVER
(+)
\X
I N T E R E S T A R B ITJR A G E , F R A N K F U R T / L O N D O N
" 3 - M O N T H TREASURY BILLS A N D
I N T E R B A N K L E N D I N G RATES
\ A
G E R M A N I N T E R B A N K I;
RATE D I F F E R E N T I A L A N D
{
- 3 - M O N T H FORWARD STERLING
SPREAD IN FAVOR OF UNITED KINGDOM B i l l
I
LOAN RATE
RATE D I F F E R E N T I A L W I T H F O R W A RD E X C H A N G E C O V E R
G E R M A N T R E A S U R Y BILLS
G E R M A N INTER RANK
,1960
>
SHORT-TERM
INTEREST
RATES
*
'^S\J 1
,'ZV
Eueo-boiue
A
-—i-
1959
1941
3-monlh treasury bill rales for all countries except Japan (3 month interbank deposit rale) and Switzerland (3-month deposit rale).,
*1* 3-month rote lor U S dollar deposits in London
:\3
LONG-TERM
BOND
YIELDS
\
CiMADA
I960
INDUSTRIAL
STOCK
INDICES*
GERMANY
100
::g-
150
100
'Not*:
Japan: Index of all ilocki Iroded
SPOT
E X C H A N G E RATES
- MAJOR
CURRENCIES
AGAINST
U.S.
DOLLAR
\V
3-MONTH
A g a i n s t
FORWARD
u
s.
EXCHANGE RATES
d o l l a r s
[ A G A I N S T P O U N D STERLING - L O N D 0 | i
AGAINST
POUND
STERL N G
- LONDON,
IttGIAM
fKMC
@FedFRASER