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MAR 24 1987-,

\A'

REsEti?S!Rfi nancial Data
FfldftttllBanR
of 3t. Louis

March 19, 1987

Average effective interest rates on mortgage loan commitments in the United
States have continued to decline over the past year. As the table on the back
page indicates, the average rate on fixed-rate mortgages (FRMs) fell by 181
basis points from February 1986 to February 1987, while the rate on adjustablerate mortgages (ARMs) fell by 156 basis points. Hence, the spread between
the rates on FRMs and ARMs narrowed over this period, although it was wider
from June through November than it had been in February 1986.
Other things the same, borrowers prefer the certainty of a fixed interest rate.
Therefore, as the spread between the rates on FRMs and ARMs narrows, the
share of new mortgages with adjustable rates typically declines. The interest
rate data in the table are for mortgage commitments, which tend to lead the
data on mortgage closings. For example, the small ARM share of new mortgages
in June 1986 corresponded to earlier, more narrow spreads in the commitment
rates. This share subsequently rose in response to the wider spread, but declined
between December and February as the spread fell.
—Philip A. Nuetzel
(continued on back page)

mi:

1IIHRVI
A RKSI KM
JZk llVNkol
nr

st. uhls

Digitized for views expressed do not necessarily reflect official positions of the Federal Reserve System.
FRASER
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
264 ------------- ,---------- 1------

BILLIONS OF DOLLARS
------------------------------- 264

BILLIONS
256.5
257.9
259.9
259.4

— JAN.
_

FEB.

261 .0

1

IS 20 12 28 12 26

JAN

FEB

MAR

0 23

APR

7 21

4

MAY

JUN
JUL
1986

18

2 16 30 13 27 10 24

AUG

SEP

6 22

OCT

5

10

NOV

3 17 31

DEC

14 28 11

JAN

25 II

25

FEB
1987

LATEST PLOTTED RESERVE MAINTENANCE PERIOD ENDING: MARCH 11, 1987
THE ADJUSTED MONETARY BASE IS THE SUM OF RESERVE ACCOUNTS OF FINANCIAL INSTITUTIONS AT FEDERAL
RESERVE BANKS. CURRENCY IN CIRCULATION (CURRENCY HELD BY THE PUBLIC AND IN THE VAULTS OF ALL
THE MAJOR
DEPOSITORY INSTITUTIONS) AM) AN ADJUSTMENT FOR RESERVE REQUIREMENT RATIO CHANGES.
SOURCE OF THE ADJUSTED MONETARY BASE IS FEDERAL RESERVE CREDIT.
DATA ARE COMPUTED BY THIS
BANK.
A DETAILED DESCRIPTION OF THE ADJUSTED MONETARY BASE IS AVAILABLE FROM THIS BANK.
RECENT DATA ARE PRELIMINARY.
ADJUSTED MONETARY BASE
COMPOUNDED ANNUAL RATES OF CHANGE,
AVERAGE OF TWO MAINTENANCE PERIODS END INGt
3/12/86

8/4/86

8/13/86

9/10/86

10/8/86

11/5/86 12/17/86

TO THE AVERAGE OF
TWO MAINTENANCE
PERIODS ENDINGi
8/13/86
9/10/86
10/ 8/86
11/ 5/86
12/17/86
1/14/87
2/11/87
3/11/87

8.5
9.0
8.0
8.8
9. 1
9.6
9.9
9.3


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

9.3
7.6
8.9
9.3
10.0
10.3
9.5

6.5
9.3
9.8
10.7
11.1
9.9

8. 1
9.3
10.5
1 1.0
9.6

12.5
13. 1
13.2
11.2

12.4
12.7
10.3

14.1
10.1

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

MONEY STOCK (Ml)
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS
760

737.0
734.9
736.9
738.8
738.2
738.7

660

6 20

3 IT

JAN

FEB

3 17 31

14 28 12 28

APR

0 23

7 21

4

JUL

MAY

AUG

18

I

15 29 13 27

OCT

10 24

8 22

NOV

3

10

JAN

2

16

2

16 SO

FEB
1987

LATEST DATA PLOTTED WEEK ENDING: MARCH 9, 1987
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS' H.B 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 ENDING:
3/10/86

6/9/86

8/11/86

9/8/86

10/6/86 11/10/86

12/8/86

1/12/87

TO THE AVERAGE
OF FOUR WEEKS
ENDING:
8/11/86
9/ 8/86
10/ 6/86
11/10/86
12/ 8/86
1/12/87
2/ 9/87
3/ 9/87

18.0
18. 1
16.9
16.9
17.7
19.8
17.0
16.3


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Federal Reserve Bank of St. Louis

17.9
15.8
16. 1
17.4
20.4
16.5
15.7

13.8
15. 1
17.4
21.6
16. 1
15. 1

13.6
17.0
22.3
15.7
14.6

20.6
26.3
17.2
15.6

31.7
17.2
15. 1

13.9
12.2

-1.1

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

3

4

MONEY MULTIPLIER^
CURRENCY COMPONENT OF MONEY STOCK s
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

RATIO

2.814
2.838
2.646
2.830

IS 27

JAN

10 24 10 24

Ml MULTIPLIER

7 21

S 19

APR

FEB

MAY

2 16 SO 14 28 11

JUL
1986

29

8 22

B 20

9 17

OCT

AUG

NOV

1

IS 29 12 28

JAN

9 23

9 29

FEB
1987

LATEST DATA PLOTTED TWO WEEKS ENDING* MARCH 9, 1987
BILLIONS OF DOLLARS

BILLIONS OF DOLLARS
192

COMPOUNDED ANNUAL RATES
OF CHANGE, AVERAGE OF
THE FOUR *EEKS ENDING
MARCH 9. 1987 FROM
THE FOUft WEEKS ENDING*
JAN.
DEC.
NOV.
OCT.
SEP.
JUN.
MAR.

12,
8,
10,
6,
8,
9,
10,

1987
1986
1986
1986
1986
1986
1966

188

11.5
10.7
9.7
10.1
9.2
8.6
6.3

184
CURRENCY

IflfiL

BILLIONS
186.8
186.9

MAR.

187.6
187.7

111 I 1 I I I I 111-1.11.1 l
6 20

9 17

JAN

FEB

9 17 31

14 28 12 28

APR

MAY

9 23

7 21

JUL
1986

4 18

1

IS 29 IS 27

AUG

OCT

10 24

NOV

8 22

9 19

2

JAN

FEB

16

2 16 30

LATEST DATA PLOTTED WEEK ENDING* MARCH 9, 1987
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

BILLIONS OF DOLLARS
575

543.7
541.4
543.3
544.6
543.9
544.2

515

6 20

J IT

JAN

FEB

3 17 51

l« 28 12 26

APR

9 23

7 21

4 18

JUL

MAY

AUG

I

15 29 13 27 10 24

OCT

8 22

5 19

2

16

2 16 30

NOV

LATEST DATA PLOTTED WEEK ENDING: MARCH 9, 1987
TOTAL|CHECkA^E|DEPOS|ITS IS THE SUM OF DEMAND DEPOSITS AND OTHER CHECKABLE DEPOSITS AT ALL

TOTAL CHECKABLE DEPOSITS
COMPOUNDED ANNUAL RATES OF CHANGE,
3/10/86

6/9/86

8/11/86

9/8/86

AVERAGE OF FOUR WEEKS ENDING:

10/6/86 11/10/86

12/8/86

1/12/87

TO THE AVERAGE
OF FOUR WEEKS
ENDING:
8/11/86
9/ 8/86
10/ 6/86
11/10/86
12/ 8/86
1/12/87
2/ 9/87
3/ 9/87

22.4
22.3
20.8
20.6
21.8
24.6
20.3
19.4


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

21.8
19.2
19.3
21.2
25.3
19.4
18.3

16.5
17.8
21.1
26.9
18.7
17.3

15.9
20.7
28.0
18.0
16.5

25.3
33.2
19.6
17.6

41.3
19.6
16.9

14.2
12.5

-5.6

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

5

6

YIELDS ON SELECTED SECURITIES
AVERAGES OF DAILY RATES

PERCENT

11.0

MUNICIPAL

7.0

3 17 31

14 28 14 28 It

FEB

MAR

APR

29

0 23

6 20

4 18

1

15 20 12 28 10 24

7 21

5 10

NOV

JUN
JUL
1986

DEC

2 16 30 13 27 13 27

FEB
1987

LATEST DATA PLOTTED ARE AVERAGES OF RATES AVAILABLE FOR THE WEEK ENDING* MARCH 20,

1987
JAN.

FEB.

MAR.

2
9
16
23
30
6
13
20
27
6
13
20 x
27

MAR

1987.

90 DAY
CD'S

30-DAY
COMMERCIAL
PAPER

90-DAY
BANKERS*
ACCEPTANCES

CORPORATE
Aaa BONDS

CORPORATE
Baa BONDS

MUNICIPAL
BONDS KX

6.22
5.90
5.85
5.82
5.88
5.97
6. 13
6.21
6. 1 1
6. 10
6. 15
6. 16

7.31
6.01
5.90
5.87
5.94
6.01
6.20
6.20
6.08
6.12
6.20
6.22

6. 10
5.74
5.73
5.70
5.83
5.88
6.07
6.07
6.03
5.98
6.08
6. 10

8.49
8.40
8.33
8.31
8.37
8.38
8.39
8.40
8.36
8.34
8.36
8.36

9.97
9.82
9.70
9.65
9.68
9.65
9.66
9.67
9.64
9.60
9.61
9.58

6.85
6.70
6.65
6.54
6.56
6.57
6.67
6.62
6.59
6.54
6.61
N. A.

NOTE*
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS* H.I5 RELEASE.
IK AVERAGES OF RATES AVAILABLE
»QK BOND BUYER'S AVERAGE l!$EX OF 20 MUNICIPAL BONDS, THURSDAY DATA
N.A. - NOT AVAILABLE


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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 i—

—1 11.0

TREASURY SECUR ITIES

1
DISCOUNT RATE

3-MONTH
TREASURY BILL

I I I I
3 17 31

JAN

14 26 14 26 II

FEB

MAR

APR

25

9 23

MAY

6 20

4

JUN

JUL

16

1

15 29 12 26 10 24

AUG

SEP

OCT

7 21

5 19

NOV

DEC

2 16 30 13 27

JAN

1986

FEB

LATEST DATA PLOTTED ARE AVERAGES OF RATES AVAILABLE FOR THE WEEK ENDINGt MARCH 20.

1987
JAN.

2
9
16
23
30
FEB.
6
13
20
27
MAR.
6
13
20 X
27

N0TE‘

FEDERAL
funds

mm

9.20
7.62
6.01
6.01
6.13
6.22
6. M
6.21
5.95
6.06
6. 12
6.08

13 27

MAR

1987
1987.

3-MONTH
TREASURY
BILL

8-MONTH
TREASURY
BILLKK*

1-YEAR
TREASURY
BILL

5-YEAR
TREASURY
SECURITIES

LONG-TERM
TREASURY
SECURITIES

5.65
5.46
5.35
5.35
5.51
5.62
5.75
5.55
5.45
5.54
5.66
5.58

5.68
5.55
5.43
5.27
5.43
5.59
5.69
5.70
5.41
5.51
5.59
5.58

5.64
5.49
5.45
5.38
5.50
5.59
5.71
5.64
5.57
5.61
5.72
5.66

6.79
6.63
6.63
6.58
6.66
6.74
6.88
6.81
6.74
6.71
6.77
6.76

7.76
7.58
7.59
7.56
7.69
7.70
7.77
7.73
7.63
7.58
7.63
7.61

flflSiyi, THE BOARD OF GOVERNORS* H.15 RELEASE EXCLUDING LONG-TERM TREASURY
IN
TREASURY BILL YIEL0S ARE ON A DISCOUNT BASIS.

M AVERaMs^OFTRATES^AVAILABLE0^0160 BY TH'S BANK'

S.S*UCT70NY*VEl*SiEfDISC0UNfK. **"• ™° MYS EARLIEH THAN D*TE SHOm


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

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

7

8
COMMERCIAL BANK
SMALL TIME DEPOSITS^
LARGE TIME DEPOSITS 2/
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
BILLIONS

1987
_

BILLIONS OF DOLLARS
410

FEB.

363.9
362.7
361.2
SMALL TIME DEPOSITS

370

I I I I
LATEST DATA PLOTTED WEEK ENDING: MARCH 9, 1987
BILLIONS OF DOLLARS
305

BILLIONS OF DOLLARS
305 ----------1---------- 1------------- 1---------I

1987

BILLIONS
-

_

FEB.

2
9
16

_

MAR.

2
9

294.1
294.3
296.7
296^7
297.
/

'A

LARGE TIME

'N

\
\

-

'A

)EPOS TS

J
7"' v/S

A_

7

J

/

-

r

j

J

-

-

‘ixL
6 20

JAN

-LLL
3 17

FEB

1LU.
3 17 31

MAR

LI.L

1 1 1

APR

MAY

14 ;

12 26

1111
9 23

111 -LU.. 1111
15

7 21

SEP

JUN
JUL
1966

LATEST DATA PLOTTED WEEK ENDING: MARCH 9,

i

11

111

_LLLL

iii

29 13 27 10 24 8 22 5 19

OCT

NOV

DEC

JAN

111
2

16

lux!

2 16 30

FEB
MAR
1987

1987

1/ TIME DEPOSITS ISSUED IN DENOMINATIONS OF LESS THAN 1100,000
2/ TIME DEPOSITS ISSUED IN DENOMINATIONS OF 1100,000 OR MORE


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

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

COMMERCIAL BANK
TOTAL TIME DEPOSITS
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

12SL
_

FEB.

BILLIONS OF DOLLARS
830

BILLIONS
819.8
820.5
824.4
825.4

815

810

805

6 20

3 17

JAN

FEB

3 17 31

M 28 12 28

APR

8 23

7 21

4

JUL

MAY

AUG

LATEST DATA PLOTTED WEEK ENDING* MARCH 9,

18

1

15 20 13 27

OCT

10 24

8 22

5 10

2 18

JAN

NOV

FEB

2 18 30

1987

TOTAL TIME IS THE SUM OF SAVINGS DEPOSITS, SMALL TIME DEPOSITS AND LARGE TIME DEPOSITS.

TOTAL TIME DEPOS1TS
COMPOUNDED ANNUAL RATES OF CHANGE , AVERAGE OF FOUR WEEKS ENDING:
3/10/86

6/9/86

8/11/86

1 .6
1.1
0.7
1.2
3.0
3.4
3.7

1.2
0.5
1.3
3.8
4.2
4.5

9/8/86

10/6/86 11/10/86

12/8/86

1/12/87

TO THE AVERAGE
OF FOUR WEEKS
ENDING:
8/11/86
9/ 8/86
10/ 6/86
11/10/86
12/ 8/86
1/12/87
2/ 9/87
3/ 9/87

-0.7
-0.1
-0.2
-0.2
0.2
1.5
2.0
2.3


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

-0.5
0.8
4.0
4.5
4.8

1.4
5.3
5.6
5.8

8.8
8.1
7.7

10.0
8.9

6.5

PREPARED BY FEDERAL RESERVE BAN< OF ST. LOUIS

9

10

BORROWINGS FROM FEDERAL RESERVE BANKS
AVERAGES OF DAILY FIGURES

BILLIONS OF DOLLARS
4.0 ------------- 1---------- 1-----

iaSL

BILLIONS OF DOLLARS
------------------------------- 4-°

MILLIONS.

TOTAL BORROWINGS

LATEST DATA PLOTTED WEEK ENDINGt MARCH 18,

1987

BILLIONS OF DOLLARS
2.5 ------------- i---------- ■----1987

BILLIONS OF DOLLARS
------------------------------- 2-5

MILLIONS

ADJUSTMENT + SEASONAL
BORROWINGS

1

15 29 12 26 12 20

JAN

FEB

MAR

9 25

APR

7 21

4

MAY

JUN

18

2 16 50 13 27 10 24

JUL
1986

LATEST DATA PLOTTED WEEK ENDINGt MARCH 18,


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

AUG

SEP

6 22

OCT

5 19

NOV

3 17 31

DEC

14 28

JAN

II

FEB
1987

25 11

25

MAR

1987

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

COMMERCIAL PAPER OF NONFINANCIAL COMPANIES
BILLIONS OF DOLLARS
95 ------------- 1---------- ,-----I 1087
MILLIONS
- FEB.

1

15 29

4

NOT SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
------------------------------- 95

77,368
77,775
76 129
75,003
75,712
75,176

12

FEB

12 26

0 23

7 21

4 18

MAY

MAR

JUN

2

16 SO IS 27

AUG

LATEST DATA PLOTTED WEEK ENDINGi MARCH 11,

10 24

8 22

5 10

3

17 31

SEP

14 28

JAN

II

25 II

FEB

25

MAR

1987

BUSINESS LOANS u
(COMMERCIAL AND INDUSTRIAL )

WEEKLY REPORTING LARGE COMMERCIAL BANKS 2/
StASUNALLY ADJUSTED

BILLIONS OF DOLLARS
290 ------------- 1--------- r—

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

_ COMPOUNDED ANNUAL RATES
_ OF CHANGE. AVERAGE OF
_ THE FOUR WEEKS ENDING
MARCH 4. 1987 FROM
- THE FOUR WEEKS ENDING*. *
-

JAN.
DEC.
NOV.
OCT.
SEP.

- MAR.

7,
3,
5,
1,
3,
,
5,

1987
1986
1986
1986
1986
i voo
1986

3.5
26.3
25.5
20.9-

JAN. 28
FEB. 4

285,567
283,744
281,738

MAR.
1

15 20 12 26 12 26

FEB

0 23

MAR

4
111111

7 21

4 16

MAY

JUN

2

LATEST DATA PLOTTED WEEK ENDINGt MARCH 4,

16 30 13 27

AUG

10 24

6 22

5 10

SEP

3 17 31

14 28

JAN

II

FEB

25

11

25

MAR

1987

1/ BUSINESS LOANS INCLUDE BANKERS' ACCEPTANCES AND COMMERCIAL PAPER.

2/ BANKS WITH DOMESTIC ASSETS GREATER THAN SI.4 BILLION


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

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

11

290

Effective Interest Rates on FRMs and ARMs,
Their Spread and the ARM Share of New Mortgages

Period
2/86
4/86
6/86
8/86
10/86
12/86
2/87

FRMs1
11.35%
10.57
11.08
10.85
10.44
9.98
9.54

ARMs1
10.13%
9.75
9.59
9.51
9.13
8.86
8.57

Spread in
basis points
122
82
149
134
131
112
97

ARM share
of new
mortgages
40%
29
21
28
30
35
27

1 Average commitment rates on mortgages of 15 years or longer maturities with 90 percent loan-to-price ratios


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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