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A

u.

Week ending: August 11r 1971
A\ V.

a‘?V

Monetary aggregates have expanded rapidly so far in 1971.
The money stock, which includes private demand deposits and currency in
the hands of the public, has expanded at a 10.5 per cent annual rate
since the four weeks ending January 6, a period of seven months (page 5).
By comparison, money expanded 5.4 per cent in 1970 and 3 per cent in 1969.
The accelerated growth of the money stock in 1970 and again in 1971 has
primarily been promoted by faster growth rates of the monetary base
(page 2). Growth of the base was 3 per cent in 1969, 6.2 per cent in
1970, and at a 10.2 per cent rate in the past seven months.
In general, long-term market interest rates are currently at
about the same level or slightly higher than their June levels, after
rising rapidly in the previous three months (page 10). However, long­
term rates are still below their year ago levels. For instance, yields
on seasoned corporate Aaa bonds averaged 7.71 per cent in the three days
ending August 11, only 7 basis points above the June average, but 60 basis
points above the February low. This rate is still well below the 8.13
per cent of August 1970. Yields on long-term government securities
averaged 5.93 per cent in the first half of this week, about the same
as the June average, but 20 basis points above the March level. For
comparison, this rate is still 80 basis points below the August 1970
level.
The rise in long-term rates since March reflected both an
unusually low level of interest rates in March (in view of the infla­
tionary anticipations), and a heavy calendar of public offerings,
possibly associated with higher price expectations accompanying the
rapid monetary expansion in 1971. Currently, long-term market rates
are high by historical standards, reflecting primarily the continued
rapid rates of price increase. For instance, corporate Aaa bond rates
averaged 4.37 per cent from 1962 through 1965. During this period, con­
sumer prices rose at only a 1.4 per cent rate. Since early 1969 yields
on these corporate bonds have averaged 7.5 per cent, while the rate of
increase of consumer prices has averaged 5.5 per cent.
Member bank deposits subject to reserve requirements, known
as the bank credit proxy, has risen at a 9.5 per cent annual rate in the
past four months, after increasing at a 16.3 per cent rate in the pre­
vious thirteen months (page 9). The proxy adjusted to include bankrelated commercial paper, Eurodollar borrowings of U.S. banks, and
certain other nondeposit sources of bank funds, has increased at a 6.9
per cent rate in the past four months, compared with an 11 per cent
rate in the previous thirteen months. Both measures were heavily in­
fluenced by the rapid reintermediation of time deposits in 1970 and
early 1971.


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

Prepared by Federal Reserve Bank of St. Louis

Released: August 13,1971

MONETARY BASEv
FEDERAL RESERVE CRED I T 2/
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED BY THIS BANK

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS
90

_

COMPOUNDED ANNUAL RATES
OF CHANGE. AVERAGE OF
THE FOUR *EEKS ENDING
___AUGUST II, 1971 FROM _
THE FOUR WEEKS ENDING.
-

JUN.
MAY
APR.
— MAR.
FEB.
_
JAN.
DEC.

9, 1971
12, 1971
14, 1971
10, 1971
10, 1971
13, 1971
9, 1970

88

8.4
9.6
9.8

86

MONETARY BASE

9.3"
9.9
10.2
10.1

84

82
MILLIONS
7
14

87
87

:8

88

1

88

I I I I

76
_

COMPOUNDED ANNUAL RATES
OF CHANGE, AVERAGE OF
THE FOUR WEEKS ENDING
___AUGUST 11, 1971 FROM _
THE FOUR WEEKS ENDING.
-

JUN.
MAY
APR.
— MAR.
FEB.
1
JAN.
DEC.

9,
12,
14,
10,
10,
13,
9,

1971
1971
1971
1971
1971
1971
1970

74

14.7
14.7
14.0
11.4~
12.5
13.9
13.9

72

FEDERAL RESERVE CREDIT

70

68
MILLIONS

I I I I I I
1

15 29 12 26

9 23

7 21

4 16

OCT

3 17

NOV

2 16 30 13 27 10 24 10 24

JAN

FEB

7 21

5 19

APR

2 16 30 14 26 11 25

MAY

1970
LATEST DATA PLOTTED WEEK ENDING: AUGUST 11, 1971
1/ USES OF MONETARY BASE ARE MEMBER BANK RESERVES AND CURRENCY HELD BY THE PUBLIC AND NONMEMBER
BANKS, ADJUSTED FOR RESERVE REQUIREMENT CHANGES AND SHIFTS IN DEPOSITS. FOR A DESCRIPTION
OF THfe BASE SEE THE AUGUST 1968 “ REVIEW*' OF THIS BANK.
2/ DEFINED TO INCLUDE HOLDINGS OF SECURITIES, LOANS, FLOAT AND ,,OTHER“ ASSETS. ADJUSTED FOR
RESERVE REQUIREMENT CHANGES AND CHANGES IN REQUIREMENTS DUE TO SHIFTS IN DEPOSITS AMONG
CLASSES OF BANKS.


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

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

1

3

RESERVES
ALL MEMBER BANKS IN THE NATION
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
32.0

BILLIONS OF DOLLARS

32.0

31.5

31.5

31.0

30.5

30.0

30.0

29.5

29.0

29.0

28.5

28.5

28.0

27.5

1

15 29 12 26

9 23

7 21

4 16

OCT

3 ir

NOV

2 16 30 13 27 10 24 10 24

1970

7 21
APR

5 19
MAY

2 16 30 14 28 11 25

JUL

AUG

1971

LATEST DATA PLOTTED WEEK ENDING: AUGUST 11, 1971
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS* H.9 RELEASE.
* BREAK IN SERIES DUE TO CHANGES IN REGULATION D EFFECTIVE OCTOBER 1, 1970.


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

aujjpNs
30.9
31.6
31.4
31.8
31.5

COMPOUNDED ANNUAL RATES
OF CHANGE. AVERAGE OF
THE FOUR WEEKS ENDING
AUGUST 11, 1971 FROM
THE FOUR WEEKS ENDING:
JUN.
MAY
APR.
MAR.
FEB.
JAN.
DEC.

9.
12,
14,
10,
10,
13,
9.

1971
1971
1971
1971
1971
1971
1970

3.7
6.6
9.2
7.9
8.8
8.8
10.2

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

4
DEMAND DEPOSIT COMPONENT OF MONEY STOCK
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS
180

BILLIONS
174.0
176.9
175.7
176.0
175.9
174.9

175

170

165

160

3 17

1 15 29 12 26

9 23

7 21

4 18

2 16 30 13 27 10 24 10 24

JAN

7 21

5 19

2 16 30 M 28 11 25

FEB
1971

1970
LATEST DATA PLOTTED WEEK ENDING: AUGUST 4, 1971
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS' H.6 RELEASE.

COMPOUNDED ANNUAL RATES OF CHANGE , AVERAGE OF FOUR WEEKS END 1NG:
8/5/70

12/2/70

5.0
3.9
6.3
7.5
6.4
8.6
8.6
8.2

1 . 1
7.5
9.6
7.2
10.8
10.4
9.6

1/6/71

2/3/71

3/3/71

4/7/71

5/5/71

9.8
11.8
8.2
12.5
1 1.7
10.6

18.8
11.6
16.4
14.4
12.7

6.7
14.3
12.5
10.9

13.7
11.5
9.6

18.6
13.8

6/2/71

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

6/71
3/71
3/71
7/71
5/71
2/71
7/71
4/71


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

6. 1

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

5
MONEY STOCK

AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS

ftlLUPNS
225.4
228.7
227.4
227.7
227.6
226.7

3 17

1 15 20 12 26

0 23

7 21

4 18

OCT

NOV

2 16 30 IS 27 10 24 10 24

JAN

FEB

7 21

APR

5 10
MAY

2 16 30 14 26 11 23

JUL

AUG

LATEST DATA PLOTTED WEEK ENDINGt AUGUST 4, 1971
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS' H.6 RELEASE.

COMPOUNDED ANNUAL RATES OF CHANGE, AVERAGE OF FOUR WEEKS ENDING:
8/5/70

12/2/70

4.9
4. 1
6. 1
7.3
6.5
8.3
8.3
8. 1

2.5
7.5
9.5
7.7
10.6
10.2
9.6

1/6/71

2/3/71

3/3/71

4/7/71

5/5/71

9.4
11.5
8.6
12.1
11.3
10.5

17.0
11.5
15. 1
13.5
12.2

7.9
13.7
12. 1
10.9

13.0
11.1
9.7

16.5
12.9

6/2/71

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

6/71
3/71
3/71
7/71
5/71
2/71
7/71
4/71


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

6.9

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

TIME DEPOSITS
ALL COMMERCIAL BANKS
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS

TOTAL TIME DEPOSITS

NET TIME DEPOSITS*

1 15 20 12 26

0 25

7 21

4 18

OCT

S 17

NOV

2 It 90 13 27 10 24 10 24

JAN

7 21

5 19

2 16 30 14 26 II 25

JUL

APR MAY
1971

FEB

1970

AUG

LATEST DATA PLOTTED WEEK ENDINGi AUGUST 4, 1971
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS' H.6 RELEASE.
* NET TIME DEPOSITS ARE DEFINED ASi SAVINGS DEPOSITS, TIME DEPOSITS OPEN ACCOUNT PLUS TIME
CERTIFICATES OF DEPOSIT OTHER THAN NEGOTIABLE TIME CERTIFICATES OF DEPOSIT ISSUED IN
DENOMINATIONS OF *100,000 OR MORE BY LARGE WEEKLY REPORTING COMMERCIAL BANKS.

NET TIME DEPOSITS
COMPOUNDED ANNUAL RATES OF CHANGE, AVERAGE OF FOUR WEEKS ENDING!
8/5/70

12/2/70

1/6/71

2/3/71

3/3/71

4/7/71

5/5/71

30.9
30.4
25.6
23.8
21.3
18.7

33.5
26.2
23.8
20.8
18.0

21.1
19.6
17.2
14.6

13.8
12.8
10.5

13.5
10.3

6/2/71

TO THE AVERAGE
OF FOUR WEEKS
ENDINGt
1/
2/
3/
4/
5/
8/
7/
8/


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

fl/71
S/71
3/71
7/71
5/71
2/71
7/71
4/71

17.3
18.3
20.8
22.0
20.8
20.4
19.4
18.1

23.2
27.7
28.2
24.9
23.6
21.5
19.3

7.7

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

/

MONEY STOCK PLUS TIME DEPOSITS
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
500 r=------- ------------ -----

BILLIONS OF DOLLARS
------------------------- 500

MONEY STOCK PLUS TOTAL TIME DEPOSITS

MONEY STOCK PLUS NET TIME DEPOSITS**

5 17

1

15 28 12 26

8 23

7 21

4 18

OCT

NOV

2 16 50 13 27 10 24 10 24

JAN

7 21

5 18

2 16 30 14 28 11 25

FEB

JUL

AUG

LATEST DATA PLOTTED WEEK ENDING. AUGUST 4, 1971

CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS' H.6 RELEASE.
8BK M2 IS DEFINED AS. CURRENCY. DEMAND DEPOSITS PLUS NET TIME DEPOSITS (SEE PAGE 6).

MONEY STOCK PLUS NET TIME DEPOSITS (M2)
COMPOUNDED ANNUAL RATES OF CHANGE. AVERAGE OF FOUR WEEKS ENDING*.
8/5/70

12/2/70

1/6/71

2/3/71

3/3/71

4/7/71

5/5/71

24.7
18.7
19.3
17. 1
15.0

14.3
16.4
14.6
12.6

13.4
12. 1
10.2

14.8
11.5

6/2/71

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

6/71
3/71
3/71
7/71
5/71
2/71
7/71
4/71


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

10.7
10.8
13.0
14.2
13.3
14.0
13.6
12.9

12. 1
17. 1
18.2
15,9
16.7
15.6
14.3

19.7
20.3
16.8
17.6
16. I
14.5

7.4

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

CERTIFICATES OF DEPOSIT
LARGE COMMERCIAL BANKS
WEDNESDAY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS
32 --------- ------------ -------

3 17

I

15 29 12 26

9 23

7 21

4 18

2 16 30 15 27 10 24 10 24

JAN

BILLIONS OF DOLLARS
-------------------- ---------- 32

7 21

5 19

2 16 30 14 28 11 25

FEB

1970
LATEST DATA PLOTTED WEEK ENDING: AUGUST 4, 1971
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS’ H.6 RELEASE.
NEGOTIABLE TIME CERTIFICATES OF DEPOSIT ISSUED IN DENOMINATIONS OF *100,000 OR MORE BY LARGE
WEEKLY REPORTING COMMERCIAL BANKS.


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

MONEY AND TIME DEPOSIT DATA

1971
JUNE

2
9
16
23
30
JULY 7
14
21
28
AUG.
4
1 1
18
25

CERTIFICATES
OF DEPOSIT

BILLIONS
NET TIME
DEPOS1TS *

28.2
28.5
28.2
28.9
28.8
29.6
30. 1
30. 1
30. 1
30. 1

225. 1
225.2
225.8
225.8
226.6
226.5
226.5
226.8
226.6
227.4

M2 *K
450.7
449.5
452.0
451.5
452.0
455.2
453.9
454.5
454.3
454. 1

* SEE FOOTNOTE PAGE 6.
HBK SEE FOOTNOTE PAGE 7.
PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

0

MEMBER BANK DEPOSITS
SUBJECT TO RESERVE REQUIREMENTS
(CREDIT PROXY )
AVERAGES OF DAILY FIGURES
SEASONALLY ADJUSTED

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS

355

345
CREDIT PROXY ADJUSTED 1/

335

- 325
CREDIT PROXY

315

305

295

285

3 17

1

15 29 12 26

9 23

7 21
OCT

4 1«
NOV

2 16 30 13 27 10 24 10 24

JAN

7 21

5 19

2 16 30 14 28 II 25

FEB

1970
LATEST DATA PLOTTED WEEK ENDING. AUGUST 4, 1971
CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS’ H.9 RELEASE.
1/ INCLUDES MEMBER BANK DEPOSITS, BANK-RELATED COMMERCIAL PAPER, EURODOLLAR BORROWINGS OF
U.S. BANKS, AND CERTAIN OTHER NONDEPOSIT SOURCES.

1971

BILLIONS
CREDIT
PROXY

JUN. 30
JUL.
7
14
2’
28
AUG.
4


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

CRED1T
PROXY
ADJUSTED

340.5
343.2
343.4
343.3
344.5
344.2

345. 1
347.3
347.5
347.6
348.6
348.0

COMPOUNDED ANNUAL RATES OF CHANGE,
AVERAGE OF THE FOUR WEEKS ENDING
AUGUST 4. 1971 FROM THE FOUR
WEEKS ENDING.
CREDIT
CREDIT
PROXY
PROXY ADJUSTED
JUN.
MAY
APR.
MAR.
FEB.
JAN.
DEC.

2,
5,
7,
3,
3,
6,
2,

1971
1971
1971
1971
1971
1971
’970

6. 1
8.4
9.5
10.5
12.4
12.9
14. 1

6.0
7.3
6.9
6.9
8.2
8.6
9.5

PREPARED BY FEDERAL RESERVE BANK OF ST. LOUIS

YIELDS ON SELECTED SECURITIES
AVERAGES OF DAILY RATES ENDED FRIDAY

PER CENT
9.0 ------

PER CENT
------- 9.0

8.5

8.5
CORPORATE Aaa BONDS
8.0

8.0

PRIME COMMERCIAL
LOAN RATE

7.5

7.5

7.0

7.0
MUNICIPAL

6.5

6.5

6.0

6.0

DISCOUNT RATE

5.5

5.5

5.0

5.0

4.5

4.5

THREE-MONTH TREASURY
BILL MARKET YIELD

4.0

4.0

3.5

3.5

3.0

3.0

0

5 IS

3 17 31 14 28 II 25

9 23

6 20

4 18

NOV

DEC

1

15 29 12 26 12 26

FEB

9 23

7 21

4 18

2 16 30 13 27

MAR

1970

1971

LATEST DATA PLOTTED ARE AVERAGES OF RATES AVAILABLE FOR THE WEEK ENDING-. AUGUST 13,

1971
JUNE

4
1 1
18
25
JULY 2
9
16
23
30
AUG.
6
13 IK
20
27

1971

CORPORATE
Aaa BONDS

3-MONTH
TREASURY
BILLS

3-5 YEAR
GOVERNMENT
SECUR1T1ES

LONG-TERM
GOVERNMENT
SECURITIES

MUNICIPAL
BONDS XBK

7.69
7.66
7.63
7.62
7.63
7.65
7.64
7.63
7.66
7.69
7.71

4.28
4.58
4.94
4.86
5. 17
5.40
5.38
5.45
5.39
5.28
5.29

5.92
6.22
6.54
6. 46
6.70
6.70
6.64
6.82
6.92
6.85
6.86

5.79
5.89
6.06
5.98
5.97
5.92
5.82
5.91
5.96
5.93
5.93

5.70
5.87
6.00
6.23
6. 19
6.06
6.03
5.97
6.05
6.07
N.A.

* AVERAGES OF RATES AVAILABLE.
** BOND BUYER'S AVERAGE INDEX 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
/

0

4

SELECTED SHORT-TERM

INTEREST RATES

AVERAGES OF DAILY RATES ENDED FRIDAY

PER CENT
9.0 ------

PER CENT
------- 9.0

COMMERCIAL PAPER
4-T0-6 MONTH

FEDERAL FUNDS RATE

5 18

3 17 31 M 28 11 25

JUN

JUL

AUG

SEP
1970

9 23

OCT

6 20

4 18 1

NOV

DEC

15 29 12 26 12 26

JAN

FEB

MAR

ill 23
I
9
APR

7

M<
197,

4 18

2 16 30 13 27

LATEST DATA PLOTTED ARE AVERAGES OF RATES AVAILABLE FOR THE WEEK END INGs AUGUST 13, 1971


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

PRIME
COMMERCIAL
PAPER
4-6 MONTH

1971

JUNE

4
11
18
25

JULY

2
9
16
23
30

AUG.

6

13
20

I___

FEDERAL
FUNDS

PRIME
BANKERS'
ACCEPTANCES

90 DAY
CD'S X9K

5.38
5.38
5.48
5.50
5.65
5.75
5.75
5.75
5.75
5.75
5.79

4.72
4.80
4.93
5. 10
5. 10
5. 10
5.20
5.48
5.40
5.65
5.58

5.00
5. 18
5.43
5.50
5.60
5.63
5.50
5.63
5.63
5.63
5.63

5.25
5.28
5.33
5.43
5.53
5.59
5.68
5.77
5.80
5.80
5.82

27

1LA0LE• FEDERAL FUNDS LAST FIVE DAYS AVAILABLE
** j^AJA ARE SECONDARY MARKET RATES, WEEKLY AVERAGES ENDING WEDNESDAY TWO
DA/
ARL'ER. CURRENT DATA APPEAR IN THE BOARD OF GOVERNORS' H.9 RELEASE.
PREPARED BV FEDERAL RESERVE BANK OF ST. LOUIS

»

12

BORROWINGS AND EXCESS RESERVES
ALL MFMBER BANKS IN THE NATION
AVERAGES OF DAILY FIGURES

BILLIONS OF DOLLARS

BILLIONS OF DOLLAR

2.0

1.6

1.2

0.8

BORROWINGS
0.4

EXCESS RESERVES
-0.4

-0.4

0.8

0.8

-

1.2

-

-

1.2

-

NET FREE RESERVES

1.6

-

2.0

-

3 17

1 15 29 12 26

9 23

7 21

4 16

5 19

2 16 30 13 27 10 24 '0 24

JAN

FEB

APR

2 16 30 M 28 11 25

MAY

LATEST DATA PLOWED WEEK ENDINGi AUGUST ’!, 197'


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

MILLIONS
1971
JUNE

2
9
16
23
30
JULY 7
14
21
28
AUG.
4
1 1
18
25

EXCESS
RESERVES
285
73
266
258
232
277
5
329
76
471
24

BORROWINGS
646
153
403
618
750
661
991
1122
545
765
593

FREE
RESERVES
-

361
80
137
360
518
384
986
793
469
294
569

PREPARED BY FEDERAL RESERVE BANK 0>" Sr. LOUIS

2.0

-

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