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RESEARCH LIBRARY
Federal Reserve Bank

Hi:&isFinancial Data
AUGl § 1986

August 14, 1986

Interest rates generally have declined over the past year. Over the same period,
Ml has grown at an annual rate of about 13 percent. The coincidence of
historically rapid Ml growth and the decline in interest rates appears to support
the view that there is an inverse relationship between changes in money growth
and changes in interest rates. A closer examination of the data, however, indicates
that this presumed relationship between money growth and interest rates is very
loose and has been contradicted on occasion.
The table on the back page depicts time periods during which M1 growth
shifted, as well as the coincident changes in interest rates. In the first and third
periods, Ml grew at similar rates, but the declines in interest rates varied by
at least 100 basis points. Comparing the second and fourth periods shows that
the very rapid Ml growth since mid-April coincided with slight increases in
rates, while the slow 4.7 percent Ml growth of the earlier period was associated
with falling interest rates.
.

—Michael T. Belongia
(continued on back page)

the

FEDERAL

A RESUME
HANK of
or st. urns


Views expressed do not necessarily reflect official positions of the Federal Reserve System.
http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

2

ADJUSTED MONETARY BASE
AVERAGES OF DAILY FIGURES

SEASONALLY ADJUSTED BY THIS BANK

BILLIONS OF DOLLARS

1M
_
246

JUN.

— JUL.
— AUG.

BILLIONS OF DOLLARS
250

BILLIONS

248

244.7
243.6

246

245.6
246.5
246.1

244
242
240
238
236
234
232
230

3 17 91

14 26 II

AUG

25

0 23

0 20

4 18

NOV

SEP

1

15 20 12 26 12 26

LATEST PLOTTED RESERVE MAINTENANCE PER 100 ENDING* AUGUST 13.

0 23

7 21

4

18

2

16 SO

15 27

DEC
1986

THE ADJUSTED MONETARY BASE IS THE SUM OF RESERVE ACCOUNTS OF FINANCIAL

TUT IONS ...____
HE VAULTS OF ALL

BSP r^iiFmmwvBs

suhis

RECENT DATA ARE PRELIMINARY.
ADJUSTED MONETARY BASE
COMPOUNDED ANNUAL RATES OF CHANGE,
AVERAGE OF TWO MAINTENANCE PERIODS ENDING:
8/14/85

11/6/85

1/15/86

2/12/86

3/12/86

7.2
8.4
7.9
7.7
8.7
8.4
8.1

9.5
8.2
7.8
9.2
8.7
8.2

9. 1
8.3
9.8
9.1
8.6

6.1
9.0
8.3
7.8

4/9/86

5/7/86

10.4
9. 1
8.3

10.1
8.8

6/18/86

TO THE AVERAGE OF
TWO MAINTENANCE
PERIODS ENDING:
1/15/86
2/12/86
3/12/86
4/ 9/86
5/ 7/86
6/18/86
7/16/86
8/13/86

7.2
7.0
7.8
7.5
7.4
8.2
8.0
7.8


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

5.7

PREPARED BY FEDERAL RESERVE BAM< OF ST. LOUIS

MONEY STOCK (Ml )
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

JUN.

BILLIONS OF DOLLARS
690

680

30
673.4
677.5
676.9
679.6

670

660

650

640

630

1

IS 20

12 26

0 23

7 21

4

OCT

NOV

18

2

16 30

13 27

JAN

LATEST DATA PLOTTED WEEK END ING-. AUGUST 4,

10 24

10 24

FEB

7 21

APR

5 10
MAY

2 16 30 14 26 II 29

1986

CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS* H.6 RELEASE.
Ml IS THE SUM OF CURRENCY HELD BY THE NONBANK PUBLIC, DEMAND DEPOSITS, OTHER CHECKABLE
DEPOSITS AND TRAVELERS CHECKS.

MONEY STOCK < Ml )
COMPOUNDED ANNUAL RATES OF CHANGE. AVERAGE OF FOUR WEEKS ENDINGt
8/5/85

11/4/85

1/6/86

2/3/86

3/3/86

4/7/86

5/5/86

6/2/86

4.4
8.7
9.9
13. 1
13.5
13.9

14.2
14.1
17.2
16.8
16.7

14.9
18.7
17.8
17.6

20.5
18.6
18.1

20.8
19.4

15.9

TO THE AVERAGE
OF FOUR WEEKS
ENDING:
1/
2/
3/
4/
5/
6/
7/
8/

6/86
3/86
3/86
7/86
5/86
2/86
7/86
4/86

12.4
9.9
10.2
1 1 .0
11.3
12.7
13.0
13.3


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

8.0
9.0
10.5
11.0
13. 1
13.4
13.7

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

3

4

MONEY MULTIPLIER!/
CURRENCY COMPONENT OF MONEY STOCK v
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

RATIO

2.9
1986
MAY
.....

RATIO

19
2

— JUL.

2.722
2.706

16
30
14
28

2.742
2.722
2.744
2.748

Ml MULT IPL I

2.7

3 17

I

JUN

IS M 12 26

JUL

AUG

0 23

SEP
1985

7 21

4 18

OCT

NOV

2 16 30 13 27

DEC

JAN

LATEST DATA PLOTTED TWO WEEKS ENDING: JULY 28,

10 24 10 24

FEB

MAR

7 21

5 10

APR
MAY
1986

2 18 30 14 28 II 25

JUN

JUL

AUG

1986

BILLIONS OF DOLLARS

ILL IONS OP DOLLARS

180
COMPOUNDED ANNUAL RATES
___OF CHANGE. AVERAGE OF
ur wwiwc, Avcnnuc ur
THE FOUR *EEKS ENDING
AUGUST 4, 1986 FROM
THE FOUR WEEKS ENDING:

JUN.
MAY
APR.
_

FEB.

— AUG.

2,
5
7
3,

1986
1986
1966
1986

178
176

5.7
6.8
6.3
6.5

174

CURRENCY

5, 1985

172
170
168
ISfifi

BILLIONS
166

164
1111111111111111
3 17

1

15 20 12 28

0 23

7 21

4 18

OCT

NOV

2 18 30 13 27

JAN

10 24 10 24

FEB

7 21

5 10

2 16 30 14 28

JUL

11

25

AUG

1985
LATEST DATA PLOTTED WEEK ENDING: AUGUST 4. 1986
1/ RATIO OF MONEY STOCK (Ml > TO ADJUSTED MONETARY BASE
2/ CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS’ H.6 RELEASE.


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

TOTAL CHECKABLE DEPOSITS
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

1M
JON.
JUL.

BILLIONS OF DOLLARS

BILLIONS

30
“

5 20

490.7
490. 1
493.7
492.8
495.1

12 20

0 23

7 21

4

OCT

NOV

18

2

10 30

13 27

JAN

LATEST DATA PLOTTED KEEK ENDING-. AUGUST 4.

10 24

10 24

FEB

7

21

APR

MAY

JUL

AUG

1986

TOTAL CHECKABLE DEPOSITS IS THE SUM OF DEMAND DEPOSITS AND OTHER CHECKABLE DEPOSITS AT ALL
DEPOSITORY INSTITUTIONS.

TOTAL CHECKABLE DEPOSITS
COMPOUNDED ANNUAL RATES OF CHANGE, AVERAGE OF FOUR WEEKS ENDING:
8/5/85

11/4/85

1/6/86

2/3/86

3/3/86

4/7/86

5/5/86

6/2/86

2.9
8.9
10.9
15.2
15.9
16.6

17.2
17.4
21.4
20.8
20.8

18.5
23.4
22.2
22.0

26.2
23.4
22.8

26. 1
24.4

19.8

TO THE AVERAGE
OF FOUR WEEKS
ENDING:
1/
2/
3/
4/
5/
6/
7/
8/

6/86
3/86
3/86
7/86
5/86
2/86
7/86
4/86

14.4
10.6
11.2
12.3
12.8
14.8
15.2
15.6


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

8.1
9.6
11.7
12.6
15.4
15.9
16.4

PREPARED BY FEDERAL RESERVE BANK OF ST. ^OUIS

5

6

YIELDS ON SELECTED SECURITIES
AVERAGES OF DAILY RATES

PERCENT

12.0

CORPORATE
Aaa BONDS

10.0

‘RIME BANK
.PAN RATE

MUNICIPAL
BONDS

8.0

6.0

JUN

JUL

AUG

SEP
1985

OCT

NOV

DEC

JAN

FEB

MAP

APR

MAY
1986

JUN

JUL

LATEST DATA PLOTTED ARE AVERAGES OF RATES AVAILABLE FOR THE WEEK ENDINGt AUGUST 15,

1986
JUNE

6
13
20
27
JULY
4
11
18
25
AUG.
1
8
15 X
22
29

AUG

1986.

90 DAY
CD'S

30-DAY
COMMERCIAL
PAPER

90-DAY
BANKERS'
ACCEPTANCES

CORPORATE
Aaa BONDS

CORPORATE
Baa BONDS

MUNICIPAL
BONDS XX

6.83
6.81
6.68
6.62
6.51
6.43
6.33
6.31
6.29
6.21
6.07

6.83
6.82
6.78
6.74
6.71
6.59
6.34
6.28
6.28
6.26
6. 19

6.76
6.65
6.55
6.54
6.39
6.33
6.21
6. 17
6. 17
6.08
5.95

9.29
9. 19
9.08
9.01
8.93
8.89
8.84
8.86
8.88
8.85
8.77

10.47
10.43
10.29
10.20
10. 15
10. 14
10. 10
10.17
10.28
10.29
10.30

7.97
8.08
7.82
7.59
7.51
7.45
7.45
7.60
7.54
7.53
N. A.

NOTEt CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS* H.15 RELEASE.
* AVERAGES OF RATES AVAILABLE
XX BOND BUYER'S AVERAGE IWJEX OF 20 MUNICIPAL BONDS, THURSDAY DATA
N.A. - NOT AVAILABLE


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

SELECTED

INTEREST RATES

AVERAGES OF DAILY RATES

PERCENT

PERCENT
— 11.0

11.0 r—

TREASURY SECUR

DISCOUNT RATE

7 21

5 19

JUN

JUL

2 IS SO 19 27 II 25
SEP

8 22

6 20

5 17 31 14 28 14 28

OCT

FEB

MAR

I 23

APR

9 23

0 20

4 18

I 13 29

MAY
JUN
JUL
AUG
1986
LATEST DATA PLOTTED ARE AVERAGES Of RATES AVAILABLE FOR THE WEEK ENDING-. AUGUST IS, 1986.

1986
JUNE

6
13
20
27
JULY
4
11
18
25
AUG.
1
8
15 x
22
29

FEDERAL
FUNDSWK

3-MONTH
TREASURY
BILL

6-MONTH
TREASURY
BILL 3I8HX

1-YEAR
TREASURY
BILL

5-YEAR
TREASURY
SECUR1T1ES

LONG-TERM
TREASURY
SECURITIES

6.95
6.89
6.87
6.86
7.02
6.87
6.51
6.42
6.32
6.36
6.31

6.42
6.29
6. 10
6.07
5.97
5.86
5.75
5.78
5.83
5.71
5.62

6.41
6.39
6. 18
6. 13
5.96
5.85
5.80
5.77
5.89
5.73
5.60

6.55
6.43
6.21
6. 14
5.98
5.92
5.83
5.89
5.91
5.81
5.68

8.02
7.83
7.45
7.33
7.21
7.13
6.91
7.01
7. 10
7.06
6.90

8.61
8.50
8.14
7.95
7.83
7.83
7.76
7.94
8.09
8.01
7.76

.T«iswSs?»n! *irw%iUMwmp« rnmam.
auct7onyaveragee?discountK) end,ng


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

rwo DAYS

™an mte shown

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

7

8
COMMERCIAL BANK
SMALL TIME DEPOSITS^
LARGE TIME DEPOSITS*/
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
415

"

jffi:

it!:}

381.0
379.9
378. a
377. <

—

t it

14
21
28
G. 4
_ AU

i

“r

■ J ill

--------1----------1--------1---------“
1986 BILLIONS

M il-

SMALL TIME 1 JEPOS TS
-

,

-

375

375

Lx

1XXL 111

1 1 IX XXL XXX XXXL 1 1 1

1 [XL XXL XXL 1111 XXL 111

:
1.1-L

LATEST DATA PLOTTED WEEK ENDING; AUGUST 4.
BILLIONS OF DOLLARS
295

BILLIONS OF DOLLARS
--------—T------------1-----------

281.1
281.0
280.1
281.1
280.5
279.9

2

/A
T

\

—

I.LL

30
7
14
21
28
- AUG.
4
- JUN.
-----JUL.

BILL 1C NS

1

12SG

.

1

1

11 1 1
1

=
280

IX-LL

17

In n

LARGE TIME

-

►EPOS TS

TTTTj

rL
5m
JUN

1111
JUL

111 . 1 1 LL
SEP

1 1 1
OCT

XXL MIL
NOV

DEC

1 1 1

1 LL 1.1X1 1 1 1 XIX Mil
7 21 5 19 2 16

JAN

FEB

MAR

1985

APR
MAY
1986

JUN

1 1 1
io M ;
JUL

III"
6 11 2!
AUG

LATEST DATA PLOTTED WEEK ENDING; AUGUST 4. 1986
1/ TIME DEPOSITS ISSUED IN DENOMINATIONS OF LESS THAN 8100,000
2/ TIME DEPOSITS ISSUED IN DENOMINATIONS OF 8100,000 OR MORE


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

280

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

265

COMMERCIAL BANK
TOTAL TIME DEPOSITS
AVERAGES OF DAILY FIGURES
SEASONALLY “

BILLIONS OF DOLLARS

1

JUN. 30
JUL.
7

14
21
28
- AL G.
4
„

1

810

BILLIONS

793.5
795.9
793.7
794.9
793.7
792.3

_

1

\

1

800

A

795

'

7^

'M i l l

\

-*•___

j iii

795

805

M 11

“
—

805

ISfifi

M M

—1
I

2

MM

790
-

M il

785

1 1 1

-

bs-------

775

■

-11 1
3 17

—/

\/

775

1111 -LI 1
i is a 12 2

j

All 1

1111
0 23

SEP
1985

_LI_L
T

21

OCT

4 18

NOV

2

1

-LLL -LLL
-LLL
16 SC
13 27 10 24

DEC

JAN

FEB

1

MAR

_LLL -LLL

APR
MAY
1986

Mill
JUN

111
JUL

III”

AUG

LATEST DATA PLOTTED WEEK ENDING-. AUGUST 4. IMS
TOTAL TIME IS THE SUM OF SAVINGS DEPOSITS. SMALL TIME DEPOSITS AM) LARGE TIME DEPOSITS.

TOTAL TIME DEPOSITS
COMPOUNDED ANNUAL RATES OF CHANGE, AVERAGE OF FOUR WEEKS ENDING:

8/5/85

11/4/85

1/8/86

2/3/86

3/3/86

4/7/86

5/5/86

6/2/86

-4.4
-3.5

-0.7

TO THE AVERAGE
OF FOUR WEEKS
END INGt
1/
2/
3/
4/
5/
6/

6/86
3/86
3/86
7/86
5/86
2/86

1/
8/

7/86
4/86

780

J -I

JL

5.4
7.8
7. I
5.7
4.8
3.4
3.0
2.7


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

11.7
9.5
6.6
5.2
3. 1
2.7
2.2

11.9

6. I

-0.3

4. 1
1.4
1 . 1
0.7

-3.0
-2.3

-0.8

-2.2

-2.3
-4.6
-3.4
-3.0

-5.9
-3.7
-3.2

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

9

10

BORROWINGS FROM FEDERAL RESERVE BANKS
AVERAGES OF DAILY FIGURES

DOLLARS

BILLI

billions

iaac

MILLIONS

552

23
6

TOTAL BORROWINGS

705

LATEST DATA PLOTTED WEEK ENDING* AUGUST 13, I
BILLIONS OF DOLLARS
------ 1------------- i---------- 2.5

BILLIONS OF DOLLARS
2.5 ---------- --------------------

1086
JUL.

AUG.

MILLIONS
9
16
23

30

6

_

229
403
413

_

404

-

348

-

ADJUSTMENT + SEASONAL
BORROWINGS

5 IB

3 17 31

JUN

JUL

14 28 11

AUG

25 B 23

SEP

OCT

8 20

4 IB

1

NOV

DEC

.

FEB

MAR

1985
LATEST DATA PLOTTED WEEK ENDING: AUGUST 13. 1
1/ B3.787 FOR 11/27/85


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

COMMERCIAL PAPER OF NONFINANC!AL COMPANIES
NOT SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

JUL.

BILLIONS OF DOLLARS

2

80,73!
81,92!
_ AUG.

5 19

6

3 17 31

14 28 11

AUG

25

9 23

6 20

4

NOV

SEP

DEC

18

LATEST DATA PLOTTED WEEK ENDING: AUGUST 6,

1

15 29 12 26 12 26

FEB

9 23

7 21

4 18

2

16 30 13 27

MAR

1986

1/
INDUSTRIAL )

BUSINESS LOANS
( COMMERCIAL AND

WEEKLY REPORTING LARGE COMMERCIAL BANKS
BILLIONS OF DOLLARS

SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
262

COMPOUNDED ANNUAL RATES
OF CHANGE. AVERAGE OF
juut ju,
iwo rnuw
THE FOUR WEEKS ENDING:

— MAY
APR.
APR.
MAR.
JAN.
OCT.
JUL.

28,
30,
2,
5,
29,
30,
31

1986
1986
1986
1986
1
1985

-0.7

MILLIONS
JUN. 25
JUL. 2

259,351
258,668
257,546

5 19

3 17 31

14 28 11

AUG

25

SEP
1985

9 23

6 20

4 18

NOV

DEC

1

15 29 12 26 12 26

FEB

9 23

MAR

J-LL I...U 1 1 I I I I I I
7 2!

4 16

MAY

JUN

Z

16 30 13 27

LATEST DATA PLOTTED WEEK ENDING: JULY 30, 1986
1/ BUSINESS LOANS INCLUDE BANKERS* ACCEPTANCES ANO COMMERCIAL PAPER.
2/ BANKS WITH DOMESTIC ASSETS GREATER THAN 81.4 BILLION


http://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

11

Recent Movements in Ml and Selected Interest Rates
Basis Point Changes

Period
8/16/85-12/6/85
12/6/85-2/7/86
2/7/86-4/18/86
4/18/86-8/1/86

Ml
growth1
11.6%
4.7
13.5
19.3

3-month
Treasury
bill

1-year
Treasury
bill

5-year
Treasury
security

11
-18
-122
-1

-14
-23
-127
6

-72
-60
-172
30

'Compounded annual rates of change of seasonally adjusted data for four-week averages ending three days
later than dates shown


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Federal Reserve Bank of St. Louis


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102