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oiyitioM or i n t e r n a t i o n a l f i n a n c e b o a r d o f eevewNow* OF T N I FEDERAL RESERVE I V I T E M October 18, 1967. , H . 13 No. 321 CAPITAL MARKET DEVELOPMENTS ABROAD I., Ten Charts on Financial Markets Abroad II. Latest Figures Plotted in H.13 Chart Series, 1967 - r Xt A 60l>^ ' i I V l I. Ten Charts on Financial Markets Abroad Chart Chart Chart Chart Chart Chart Chart Chart Chart Chart 1 - New York, London, Montreal: Yields for U.S. Dollar Investors on 3-month Funds 2 - 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 Europe and British Commonwealth Section. OFFICIAL USE ONLY (Decontrolled after six months) -r , NEW YORK, LONDON, MONTREAL: Y I E L D S FOR U . S . D O L L A R DOLLAR DEPOSIT INVESTORS O N RATES: NEW 3-MONTH FUNDS YORK -LONDON EURO-DOLLAR DEPOSIT U.S. CERTIFICATE OF DEPOSIT 4 EURO-DOLLAR OVER U.S. CERTIFICATE OF DEPOSIT FINANCE CO. PAPER RATES ( c o v e r e d ) : QUOTED IN N E W YORK U.K. HIRE PURCHASE CANADIAN FINANCE COMPANY U.S. FINANCE COMPANY Mar. Jun. Sept. Dec. Mar. 1965 Jun. 1966 Sept. Dec. Mar. lun. 1967 Sept. Dec. Mar. Jun. 1968 Sept. Dec. LONDON: EURO Y I E L D S FOR U . S . DOLLAR IHVIfTOtS ON 3-ttONYH FUNDS D O L L A R D E P O S I T RATES 30 DAY 180 DAY 90 DAY HIRE PURCHASE AND LOCAL AUTHORITY i DEPOSIT RATES ( c o v e r e d) HIRE PURCHASE > i ! ! ! j h ! ! . EURO-DOLLAR DEPOSIT ;' V ^ 2 % : I : L : DIFFERENTIAL FAVOR H I R E P U R C H A S E FAVOR E U M , D O L L A R EURO-DOLLAR DEPOSIT LOCAL AUTHORITY DEPOSIT i DIFFERENTIAL ^ FAVOR LOCAL AUTHORITY T ' /I 1 : , | i 1965 1966 ^^AVOR i i i EURODOLLAR i n i i M INTEREST ARBITRAGE; FRANKFURT/LONDON, FRANKFURT INTERBANK LOAN RATE V S . L O N D O N ZURICH/LONDON E U R O - D O L L A R RATE ( C O V E R E D ) • Hi, I I N TE:RMS C)F D M I INTERBANK LOAN RATE o C M jFTpsrC x | K > t y r - I ; i i DIFFERENT! . yv / ! i i AL I , \ 1 EURO-DOLL AR I i i J( ! 1 \ ' : ' 1 1 | j \ y \ \ FAVOR FRAN KFURT \ | l./n. k 1 1 ZURICH DEPOSIT RATE VS. LONDON EURO-DOLLAR RATE i i ! i i II FAVOR EURO-DOLLAR (COVERED) I N T E R M S OF S W I S S F R A N C S EURODOLLAR t SWISS DEPOSIT RATE DIFFERENTIAL FAVOR ZURICH FAVOR E U R O D O L L A R PRICE OF GOLD IN LONDON 35.3 35.0 1965 1966 1967 1968 IN 3-MONTH TREASURY BILL R A T E S ! CAN. FIN. C I . 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 3-MONTH COVERED ! RATE D I F F E R E N T I A L S ! | ! | ! ! (NET | INCENTIVES) : I 1 PRIME FINANCE PAPER FAVOR CANADA i FAVOR U.S. FAVOR CANADA ~ TREASURY BILLS IAV0I 1964 1965 1966 1967 U.S. AREST ARBITRAGE, NEW 3-MONTH YORK/LONDON T R E A S U R Y BILL R A T E S " U.K. LOCAL AUTHORITY DEPOSITS" ^ i LONDON K NEW YORK RATE DIFFERENTIAL AND 3-MONTH FORWARD STERLING SPREAD IN FAVOR OF LONDON PREMIUM FORWARD RATE RATE D I F F E R E N T I A L WITH FORWARD EXCHANGE I COVER DISCOUNT (NET IN FAVOR OF LONDON INCENTIVE) iA IN FAVOR OF NEW YORK 1965 1966 1967 1968 SHORT-TERM INTEREST RATES* EURO-DOLLAR - LONDON + U.S. SWITZERLAND 9 JAPAN GERMANY 1963 1964 Switzerland (3 month deposit rate) and Germany (interbank Loan Rote, **j"" 3-month rote for US dollar deposits in London 1965 1966 1967 I SWITZERLAND EURO-DOLLAR BONDS' 1963 1964 1965 Average of yields for four foreign government dollar bonds quoted m London New series for Germany Horn 7 9 65 New series for Switzerland starts 3-3 67 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 SWISS FRANC GERMAN MARK U.K. STERLING BELGIAN FRANC DUTCH GUILDER FRENCH FRANC CANADIAN DOLLAR ITALIAN LIRA JAPANESE YEN M J 1965 S D M J 1967 S D M J 1968 S D \0 >NTH FORWARD f AINST U.S. E X C H A N G E RATES DOLLARS — N E W YORK SWISS FRANC GERMAN MARK POUND STERLING DUTCH GUILDER CANADIAN DOLLAR AGAINST POUND STERLING — L O N D O N SWISS FRANC \ U.S. DOLLAR r*v GERMAN MARK U FRENCH FRANC! I N D U S T R I A L STOCK INDICES SWITZERLAND October 18, 1967. H. 13 No. 321 (all figures per cent per annum) Upper Panel Chart 1 (Wednesday, Oct. 11 Euro-$ deposit 5.50 U.S. certif. of deposit 5.16 Lover Panel (Friday, Oct. 13 ) Treasury bills: ) U.S. Canada Hire-purchase paper, U.K. * Spread favor U.K. Treasury bills: 90-day 180-day 5.50 5.75 Hire-purchase paper (Oct. 6) Interbank loan (mid-point) 4.18 Euro-$ deposit (average) 4.33 (Date: 2.75 35.191 ) Treasury bills: Canada U.S. Spread favor Canada 4.79 4.58 '+ .21 Forward Canadian $ -1.16 Net incentive (Canada •*•) - .95 - .75 0 ) 4.58 5.33 4. 79 U.S. U. K. Canada 4.18 Zurich 3-month deposit (Date: Sept. 15 Japan composite rate (Date: June 30 5,5$ ) 2.75 ) 7.29 Chart 7 U.S. Gov't. (Wed. , Oct. 11 ) 5.11 6.90 U.K. War Loan (Thurs., Oct. 12 ) German Fed. (Fri., Oct. 13 ) 6.63 Swiss Confed. (Fri., Oct. 6 ) 4.55 Canadian Gov't. (Wed., Oct. 11 ) 6,42 Netherlands Gov't, perpetual 37. (Friday, Sept. 29 ) Oct. 6 Euro- $ bonds (Fri., Oct. 13 ) 5.75 5.85 6-39 ) Chart 4 (Friday, Oct. 13 Canadian finance paper ) ) Sept. 15 Zurich 3-month deposit Price of gold (Friday, Oct. 6 + • 75 Interbank loan rate (German) (Oct. 8--15) Euro-$ deposit (London) 5,12 5.25 Local-authority deposit (Oct. 6) Chart 3 Upper Panel (Period: Oct. 8 — 1 5 Lower Panel 5.22 4.58 Chart 6 (Friday, Oct. 13 Euro-$ deposits: 4.56 4.75 U.K. U.S. Net incentive (U.K. +) 5.15 5.19 Chart 2 (Friday, Oct. 13 ) Call 30-day ) Forward pound 4.88 Finance co. paper: Chart 5 (Friday, Oct. 13 $.28 For descriptions and sources of data, see special supplement to H.13, Number 239, March 16, 1966.
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