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· .- FEDERAL RESERVE statistical release ·- For release at 4:30 PM EST March 1, 1990 H.3 (502) SPECIAL NOTICE Aggregate data for reserves and the monetary base have been revised to reflect the break adjustment for the January 1990 indexation of the low reserve tranche and the reserve requirement exemption, and the annual re-estimates of seasonal factors. 1 The break adjustment affected reserves and the monetary base only back to January 1989, lowering the growth rate of reserves by about 0.3 percent over the year, and the growth rate of the monetary base by 0.1 percent. The new seasonal factors raised growth rates in the first half of 1989 by about 0.4 percent for reserves and 0.2 percent for the monetary base, with similar downward revisions to the second-half-year growth rates. The break adjustment for the recent January indexation 2 continued to employ the procedure adopted last year . Under this 1. Tl1e Monetary Control Act of 1980 established a reserve ratio of 3 percent against the first $25 million in transaction deposits (low reserve tranche) at each depository institution. Since 1982, the low reserve tranche has been indexed each January by 80 percent of the previous year's (June 30 to June 30) growth rate of net transaction deposits at all depository institutions. Under the Garn-St Germain Depository Institution Act of 1982, th~ first $2 million of reservable liabilities of each depository institution are exempted from reserve requirements. Since 1983, this exemption amount has been inde::ed each year by 80 percent of the rate of increase of total reservable liabilities at all depository institutions over the preceding year (June 30 to June 30) . Both of these indexations take effect each year in the reserve computation periods containing January 1. 2. For details, see the H.3 released on May 4, 1989. -2- technique, in order to put current-year data on a comparable basis with the historical data, the data in the current year are adjusted using estimates of the low reserve tranche and reserve requirement exemption that will take effect next January. The growth of seasonally adjusted net transactions deposits and total reservable liabilities from June 1989 through January 1990, and extrapolated through June 1990, implies that the low reserve tranche will rise approximately $1 million and that the reserve requirement exemption will not change at the start of next year. The break-adjusted data for 1990 will be constructed under these assumptions. Revised historical data will be available shortly from the Money and Reserves Projection Section, Division of Monetary Affairs, Stop 75, Board of Governors of the Federal Reserve System, Washington, D.C. 20051, (202) 452-3361. FEDERAL RESERVE statistical release H.3 (502) Table 1 For Release at 4:30p.m. Eastern Time AGGREGATE RESERVES OF DEPO~ITORY INSTITUTIONS AND THE MONETARY BASE Adjusted for changes in reserve reguirements Averages of daily figures, seasonally adjusted unless noted otherwise Millions of dollars required 1, 1990 Borrowings of depository institutions from the Federal Reserve, NSA Reserves of depository institutions nonborrowed plus exte~ credit MARCH exce~s Monetaty base total 59Z14 59229 59023 1145 1154 957 276767 277561 27847Z 1662 1487 1813 76 97 139 1046 1050 1334 58769 58304 58024 58575 57796 57692 776 1031 905 278398 278712 279210 2289 17ZO 1490 213 345 431 1707 1197 917 58173 58231 58596 58279 5827Z 58618 57901 58021 58351 966 885 938 280137 280923 281970 694 675 693 497 490 452 106 41 22 59640 59646 60033 59085 59297 59767 59106 59318 59787 58620 58701 59110 1020 945 922 282944 283381 285105 555 349 265 330 134 84 Z1 21 20 59897 59457 59482 58880 1016 287692 440 47 26 1989-DEC. 27 60403 60052 60070 59385 1018 285786 351 89 19 1990-JAN. 10 24 60059 59682 597ZO 59382 59739 59409 58942 58840 1117 841 286570 287702 339 300 58 41 19 27 60093 60223 59228 58743 59261 58875 58873 59240 1220 983 289273 289518 865 1480 44 33 133 Date total 2 1989-JAN. FEB. MAR. 60358 60383 59980 58696 58896 58168 59742 59946 59502 APR. MAY JUNE 59351 58826 58597 57062 57106 57107 JULY AUG. SEP. 58867 58906 59289 OCT. NOV. DEC. 1990-JAN. nonborrowed3 NSA seasonal extended credit4 Two weeks ending FEB. 7 21p p--preliminary 1. 2. 3. 4. 5. 6. so pe--preliminary estimate Reserves and monetary base figures incorporate adjustments for discontinuities, or "breaks", associated with regulatory changes in reserve requirements. (For more information, see Table 3. J Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break-adjusted required reserves plus unadjusted excess reserves. IAlso, see footnote 2 on Table 2 and footnote 2 on Table 3. J Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted, break-adjusted total reserves less unadjusted total borrowings of depository inst1tutions from the Federal Reserve. Extended credit consists of borrowing~at the discount window under the terms and conditions established for the extended credit program to help depository institutions deal with sustained liquidity pressures. Because there is not the same need to repay such borrowing promptly as there is with traditional short-term adjustment credit, the money market impact of extended credit is similar to that of nonborrowed reserves. Excess reserves NSA equals unadjusted total reserves (Table 2, column l l less unadjusted required reserves (Table 2, column 3). The seasonally adjusted, break-adjusted monetary base consists of I l l seasonally adjusted, break-adjusted total reserves plus 12J the seasonally adJusted currency component of the money stock plus 13), for institutions whose vault cash exceeds their required reserves, the seasonally adJusted, break-adjusted excess of current vault cash over the amount applied to satisfy current reserve requirements. !Also, see footnote 3 on Table 2 and footnote 4 on Table 3.) H.3 1502 l Table 2 AGGREGATE RESE~VES OF OEpOSIT9RY INSTITUTIONS AND THE MONETARY BASE Not adjusted for changes 1n reserve regu1rem~nts Averages of daily figures, not seasonally adJusted Millions of dollars Reserves of depository institutions Vault cash5 Net carryover of reservw balances Date total 2 nonborrowed required Monetasy base Reserve balances with F.R. Banks 4 1989-.JAN. FEB. MAR. 63468 60693 60212 61806 59206 58400 62323 59539 59255 281344 277700 279003 36475 32834 34623 28385 29787 27071 26993 27859 25589 1393 1928 1482 APR. HAY .JUNE 61288 58911 59587 58998 57191 58097 60511 57881 58681 281599 280638 283276 35.832 33199 33852 26760 27184 27161 25456 25712 25735 1304 1471 1425 .JULY AUG. SEP. 60254 59559 60126 59560 58884 59433 59288 58674 59188 285389 284230 283779 33902 32823 33556 27851 28362 28089 26351 26735 26570 1499 1627 1519 OCT. NOV. DEC. 60397 60989 62810 59842 60640 62544 59378 60044 61888 284487 287347 292713 33123 33941 35436 28897 28519 28782 27275 27048 27374 1622 1472 1409 1990-.JAN. 62931 62491 61915 292314 34090 30354 28840 1513 1989-DEC. 27 63033 62682 62015 294270 35131 29415 27903 1513 63 1990-.JAN. 10 24 64961 62468 64622 62169 63844 61627 295762 291499 36627 34424 29695 29338 28335 28045 1360 1294 118 190 60956 60545 60091 59065 59736 59562 289019 290545 29802 30586 33327 31932 31155 29959 2172 1973 70 117 total used to satisfy requireCI reserves 6 surplus 7 Two weeks ending FEB. 7 21p p--preliminary 1. 2. 3. 4. 5. 6. 7. 8. pe--preliminary estimate Reflects actual required reserves, with no adjustments to eliminate the effects of discontinuities, or "breaks", associated with regulatory changes in reserve requirements. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy reserve requirements. The monetary base, not break-adjusted and not seasonally adjusted, consists of total reserves plus required clearing balances and adjustments to compensate for float at Federal Reserve Banks plus the currency component of the money stock plus, for institutions whose vault cash exceeds their required reserves, the excess of current vault cash over the amount applieCI to satisfy current reserve requirements. After the introduction of CRR, currency and vault cash figures are measured over computation periods ending on Mondays. Excludes required clearing balances and adjustments to compensate for float and includes other off-balance sheet "as-of" adjustments. Dates refer to the maintenance periods in which the vault cash can be used to satisfy reserve requirements. Under contemporaneous reserve reguirements, maintenance periods end 30 days after the lagged computation period~ in which the balances are held. All vault cash held during the lagged computation period by "bound" institutions li.e., those whose required reserves exceed their vault cashl plus the amount of vault cash applied during the maintenance period by "non.,ound" institutions li.e., those whose vault cash exceeds their required reserves) to satisfy current reserve requirements. Total vault cash held by depository institutions minus the amount applied to sati$fy reserve requirements. Consists of carryover only at depository institutions maintaining reserves on the basis of two-week maintenance periods. Reflects excess (+)or deficit 1-) reserves elig1ble to be carried forward into the two-week reserve mai"tenance period ending on the date shown. H 3 15021 Table 3 AGGREGATE RESERVES OF DEPO~ITORY INSTITUTIONS AND THE MONETARY BASE Adjusted for changes in reserve requirements Averages of daily figures, not seasonally adjusted Hillions of dollars Reserves of depository institutions Date total 2 nonborrowed required 3 Honetary base 4 1989-JAN. FEB. HAR. 62071 59388 58969 60409 57901 57156 60926 58234 58011 277958 274426 275715 APR. HAY JUNE 60058 57781 58485 57769 56061 56995 59282 56750 57580 278239 277649 280260 JULY 59044 58399 59025 58350 57725 58332 58078 57515 58087 282189 281193 280819 NOV. DEC. 59272 59869 61669 58717 59520 61404 58252 58924 60747 281502 284272 289605 1990-JAN. 61580 61140 60563 288853 1989-DEC. 27 61900 61549 60882 291282 1990-JAN. 10 24 63709 61120 63370 60820 62592 60278 292404 288040 59457 59136 58592 57656 58236 58153 285408 287105 AUG. SEP. OCT. Two weeks ending FEB. 7 2lp p--preliminary 1. 2. 3. 4. pe--preliminary estimate Figures reflect adjust~ts for discontinuities, or "breaks", associated with regulatory changes in reserve requirements. Break-adjusted total reserves equal break-adjusted required reserves !Table 3, column 31 plus excess reserves NSA !Table 1, column 51. To adjust required reserves for discontinuities due to regulatory changes in reserve requirements, a multiplicative procedure is used to estimate what required reserves would have been in past periods had current reserve requirements been in effect. Break-adJusted required reserves includes required reserves against transactions dePosits and nonpersonal time and sav1ngs deoosits lbut not reservable nondeposit liabilit1es. I Break-adjusted monetary base ~ls Ill break-adjusted total reserves plus 121 the !unadjusted) currency component of the money stock plus 131, for institutions whose vault cash exceeds their required reserves, the break-adjusted excess of current vault cash over the amount applied to satisfy current reserve requirements. Note: Historical data are available from the Honey and Reserves Projections Section, Pivision of Honetary Affairs, Board of Governors of The Federal Reserve System, Hashington, D.C. 20551
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