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■r

>&>£?■£ OjA^-

S

1970

LIBRARY

The money stock has risen at a 5,7 per cent annual
rate since the four weeks ending March 25, a period of six
months. From the first quarter to the three months ending
September 23 the rate of increase was about 5 per cent. By
comparison, this magnitude changed little on balance over
the eight months ending with February. From 1957 to 1965
money grew at a 2.2 per cent trend rate, but a somewhat
faster rate may now be appropriate. Even though monetary
expansion is at a rate which may stimulate a faster rise in
:al spending than before 1965, downward pressure may be
placed on the current rapid trend of prices. Velocity of
money, which has risen at an average 3.2 per cent per year
rate since 1957, may not rise so rapidly now that liquidity
has been substantially reduced, and because the upward
trejfid of interest rates may not continue.
Federal Reserve credit has increased at an 8.7
per cent annual rate over the past six months and member
bank reserves at a 10.8 per cent rate. These rates are
substantially higher than in the previous eight months, but
a substantial portion of the increase has been absorbed by
the reintermediation of time deposits.
Effective October 1, reserve requirements were
reduced from 6 per cent to 5 per cent on that part of a
' 'mber bank's total time deposits in excess of $5 million,
_d a 5 per cent reserve requirement was placed on funds
obtained by member banks through the issuance of commercial
paper by their affiliates. Anticipation of this latter
change, together with lower short-term interest rates and
relaxation of Regulation Q, has induced a substantial


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

run-off of bank-related commercial paper. The two actions
together are expected to reduce required reserves about
$350 million for all member banks.
Short-term interest rates have fallen substan­
tially from their January levels, while longer-term rates
have declined more moderately or not at all, resulting
in a considerable spread between long- and short-term
rates. Yields on 4- to 6-month commercial paper averaged
7.13 per cent for the three days ending September 30,
down from 9 per cent in early January. The three-month
Treasury bill rate has averaged under 6 per cent for the
p'ast two weeks, down from about 8 per cent in January.
Yields on highest-grade seasoned corporate
bonds averaged 8.05 per cent for the three days ending
September 30, not much changed from the January average
of 7.91 per cent. Rates on state and local government
securities were 5.95 per cent on September 24, down from
6.50 per cent in early January. Yields on 3- to 5-year
Government securities averaged 7,06 per cent in the first
three days of this week, compared with 8.25 per cent in
early January.
As a result of declining market interest rates,
the current 6 per cent discount rate (the interest rate
charged by Federal Reserve banks for reserves borrowed by
member banks) is more nearly in touch with market interest
rates than in either the second half of 1969 or the first
half of 1970.

Prepared by Federal Reserve Eank of Sh Louis
Released: October 2, 1970

till

MONETARY BASE LL
FEDERAL RESERVE CREDIT [2
Averages of Daily Figures

of Dollars

84

Seasonally adjusted by this bank

Annual rates of change, average of
four weeks ending September 30, 1970 from
four weeks ending:
83

Monetary

F.R.

July 29, 1970
July 1, 1970
May 27, 1970
Apr. 29, 1970
Apr. 1, 1970
Mar. 4, 1970

82

81

Billions of

82
Monetary Base

1957-1969

81

Uses of the monetary base are member bank
80

reserves and currency held by the public

80

and nonmember banks, adjusted for reserve
requirement changes and shifts in deposits.
79

For a description of the base see the August
1968 Review of this bank.
79

78

, 78

4 69
77

68
Federal Reserve Credit
76
67

67

L 1

66

1

7a

J 1

Monetary
Base

F.R. Credit

66

Uii
<,<. e/7
o&, c297
(ol a+i
(7 7t 7

65

b is/<r
b 7 i> 7!
CoH Oic

64

AS,

YU 77
£

64

0

requirements due to shifts in deposits among

Latest data plotted week ending: September 30,
1 i i m i i i i i i r i m i i i i i i i i i

9

23
July


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

6

20
Aug.

3
17
Sept.

1
1969

15 29
Oct.

12 26
Nov.

10

24

7 21
Jan.

classes of banks.
_L_i__i__i__i__i__i
-J—i—i—i—i—i—i—i—i—i_j__i__i__i_i__i__i__i__i i i
4 18 4 18
15 29
13 27
10 24 8 22
Feb.
Mar.
Apr.
May
June
, July
1970 '

i i i i
5 19
Aug.

2AAA 7
2 is/ ?
3i^*£

A3

for reserve requirement changes and changes in
jLl i

yi l ev

n>

loans, float, and 'bther"assets, adjusted

t /5 7V

A
?

Defined to include holdings of securities,

798

ys.
i?

65

Jo

£

0
16 : 10 14
28 11 25
Sept
Oct .
Nov.

Prepared by Federal' Reserve Bank of St. Louis

9

23
Dec.

6

20
Jan.
1971

i

RESERVES
Ail Member Banks in the Nation
Averages of Daily Figures

11 11iiv

SO. 5

Dollars
30.5

Seasonally Adjusted
Annual rates of change, average of four weeks
,
:ig September 30, 1970 from four weeks ending

30.

30.0

y

29.5

29, 19 70
! y 1, 1970
27, 1970
29, 19 70
1, 1970
4, 19 70

29.5

29.0

29.0

28.5

28.5

28.0

28.0

27.5

27.5

27.0

27.0

26.5

26.5
4_

4-

^7'?
■3

IS

26.0

TOTAL
reserves

S?

S
'3l

21.0
91.U

x.

26.0

At.o

ars-t

25.5
Sr cult la series cias to

25.5

s.ij

25.0

24.5

0

25.0

Latest data plotted week ending: September 30, 1970

9 23
July

6

20
Auv,


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

3

17
Sept.

1
1969

15 29
Oct.

12 26
Nov.

10 24
Dec.

7

21
Jan.

24.5
4

18
Feb.

4 18
Mar.

1

15 29
Apr.

13 27 10 24 8 22
May
June
July
1970

5

19
Aug.

2

16 30
Sept.

14 28
Oct.

11 25
Nov.

Prepared by Federal Reserve Bank of St. I.ouls

9

23
Dec.

6

20
Jan.
1971

0

DEMAND DEPOSIT COMPONENT OF MONEY STOCK
Averages of Daily Figures
Bi 1
174

of

Dollars

Seasonally Adjusted
TTTfTlT-I-1 M l! 1IT-N-I-I l-H-l H-l-l-i T4-W-) 444

173

Billions

of

Annual rates of change, average of four weeks ending:

172

1/21/70

2/25/70

3/25/70

4/22/70

5/20/70

6/24/70

173

7/22/70

172

171

171

to average
of four
weeks ending:

170

170

169
3/25/70
4/22/70
5/20/70
6/24/70
7/22/70
8/26/70

168
167
166

169

-10.7
+17.7
+ 8.4
+ 5.3
+ 5.3
+ 6.3

+ 2.6
-

0.6

1.2
0.1

+ 1.4

+
+
+
+

168

9.8
5.2
5.3
6.4

- 6.9

2.8
+ 0.6
-

23/70

165

167

+ 0.8
+ 4.1

+ 8.1

166

■h 0 -3

165

164

164

163

163

162

162

161

161

160

160

159

159

158

158

157

157

156

156

155

155

154

154

153

153

152

152

151

151

150

150

149

149

148

148

147

147

146

146

145
Currant data appear in the Board'* H.6 release.-----------

145

__
Latest data plotted week endiiag: September 23, 1970
J..1.1..JL
I
i_L.1....i ii m ,1 lXmiTi iiii
9
23 6
20 3
17 1 13
29 U ?t jo 24 7 21 4

144

-144

O^

lars
174

-

1

July

i

1

1

1

Aug.


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

t

1

1

1

I

1

1

Sept.

L

1

1

Oct.

,

Hov.

Dec.

-.

.

■

I

Jan,

II

?t

4

18

15 29

13

27 10 24
June

8

22

5

19

2

0
16 30

14 28

11 25

1969

Prepared by Federal Reserve Bank of St. Louis

9

23

6

20
Jan.

1
MONEY STOCK
Averages of Daily Figures
Billions of Dollars

Billions of Dollars

Seasonally Adjusted
Annual rates of change, average of four weeks ending:
1/21/70

2/25/70

3/25/70

4/22/70

5/20/70

6/24/70

7/22/70

to average
of four
weeks ending:
3/25/70
4/22/70
5/20/70
6/24/70
7/22/70
8/26/70
<?/a3|7£>

-

6.2

+ 4.2
+ 1.9
+ 1.3

+ 6.3

+ 6.4

+ 2.0

+ 6.1

+ 3.1

+ 6.7

+ 6.1
+ 6.8

+15.7

+ 8.8

+10.2

2.9
0.2

+ 2.1

+ 2.2

+ 4.5

-

+ 7.4

—

/9 np
j>

/4‘-c‘7

J

—

-S'

/#

'

II
__
__

----------

i i i i I i 1 i i it i i i i i i itt r.t r t i.i.. ■
Latest data plotted week ending: September 23, 1970

m

L—l—L_i—I—I—I—I—1—1

9

23

July

6

20

17

1

15

Aug.


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

1969

29

12 26

10

?'t

7 21

4

18
6.

4

18

Mar.

1

15
Apr.

29 13
May

2 7 10 24
June

8

22

July
1970

5

19 2
Aug.

16
Sept.

30 14

28

Oct.

11 25

9

tiov.
'

Dec.

Prepared by Federal Reserve Bank of St. Louis

23

6

20
Jan.
1971

190

TIME DEPOSITS
All Commercial Banks
Averages of Daily Figures

231

£
Billions of

Seasonally Adjusted

229

Annual rates of change, average of four weeks
ending Sept. 23,

227

1970 from four weeks ending:
227

225

July 22,
June 24,

223

1970
1970

225
223

May 20, 1970
Apr. 22,
Mar. 25,

221

1970
1970

221

V-

219

219

217

217

-hi 1.3

1957-1969
215

215

213

213

211

211

209

209

207

207

205

205

203

203

201

201

199

199

197

197

195

195

193

193

191

191

189

189

187

187

185

185

183

183

/■? 1 All, 4

181

181

179

179

177

177

175

175

173
171
o'-

173

1 1 1 11 1 1 11 1 1 n i n t 1 1 1 n n-mzzzzzz:

Latest data plotted week ending: Sept. 23,

1970

9

23
July


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

6

20
Aug.

3 17
Sept.

1

15 29 12 26
Oct.
Nov.
1969

10 24
Dec.

171

_

-1 .i III!! 1-1-i I 1 1 .1 ! Hi f T ITT iTTT I I I I II
7 21
Jan.

4 18
Feb.

UJ-i- - - -Li-1-1.1
4 18
Mar.

I- L.

I

1' 15 29 13 2 7 10 24 8 22
Apr.
May
June
July
1970

L1..1.1.J
5

19
Aug.

M n. 1 1 I ! 1 I r 1 T7~l I

2
16 30
Sept.

14 2 8
Oct.

11

25
Nov.

Prepared by Federal Reserve Bank of St. Louis

9

23
Dec.

6

20
Jan.
1971

0

MONEY STOCK PLUS TIME DEPOSITS
Averages of Daily Figures
of Dollars

7
Billions of

Seasonally Adjusted

432

i

i

i

i Mil i n-1 i i i n m m i i i i i i i i... rn
Annual rates of change, average of four weeks endings

i

430

1/21/70

2/25/70

3/25/70

4/22/70

5/20/70

6/24/70

i

i i—
"~

7/22/70

-

428
426
424
42?
420
418

to average
of four
weeks ending:
3/25/70
4/22/70
5/20/70
6/24/70
7/22/70
8/26/70

426
424
+
+
+
+
+

1.7
6.7
5.8
5.3
7.2
9.6

422

+16.4

+12.1

+13.4

+ 9.9
+11.3
+13.4

+10.1

+ 3.3
+ 7.7

+11.7
+14.1

+11.6

416

420
+ 9.8
+14.3

418
+19.8
416

+n.7

414

414

412

412

410

410

408

408

406

406

404

404

402

402

400

400

398

398

396

396

394

394

392

392

390

390

388

388

386

386

384

384

382

382

380

380

378

378

376

376

374
372

374

1 1 1 < » i i i i i i i r i I J I r 4 1 J

Latest data plotted week ending: Sept. 23,

i I I M I 1J_.l—l—Li-l-L]

9

23
July

6


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

20 3
17
Aug.
Sept.

1

1969

J,

372

19701

1..J..L1..L-L1.

15 29 12
26 10 24
Oct.
Nov.
Dec.

7
.

-i-1----- —■——k_J—1——I——L_J------J—l.—L i—1I.-1 L...
15 29
Apr.

13 27
May

10 24
June

8

22
July
1970 '

5

19
Aug.

2

16 30 H 28
Sept.
Oct.

LJ—1-1—I—1—1
______
11 25
Nov.

Prepared by Federal Reserve Bank of St. Louis

9

23
Dec.

0

CERTIFICATES OF DEPOSIT Q_
Large Commercial Banks
Wednesday Figures

Billions ?f Dollars

Billions of Dollars

Millions $f Dollars

i77C~~
5

flua

~
IB,478
,6342

Current find year ago data appear in the
1/ Negotiable time certificates of deposit
in denominations of $100,000 or more.
Latest data plotted week ending: gept. 23,

6

20

3

17

1

15

29 12

1970

18

4

18

1

15

29 13

27

10 24

8

22

5

19

16 30

14 28

11

July


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

1969
Prepared by Federal Reserve Bank of St. Louis

25

S

23

6

20

MEMBER BANK DEPOSITS SUBJECT TO RESERVE REQUIREMENTS
(CREDIT PROXY)
Billions of Dollars
328

Billions of Dollars

Averages of Daily Figures
I i I M I I I I l I
Mill
Annual rates of change average of
four weeks ending Sept. 23, 1970 from

328

Seasonally Adjusted

32b

0

/ \A2
:

four weeks ending:

“1

Credit

Credit

Proxy
Adjusted

1

322

>

320

—

4T5o7f

July 22,

324

33 33

318

June 24,

316

May 20,

CREDIT
PROXY
ADJUSTED

Mar. 25
Feb. 25,

“T

IS.o

-

1M1J

Apr. 22

7

314
312

f
V

310
308

7
1

3 o7 « 1-

306

/
/
A
/,
/

304
302
300
298
296

7

294

CREDIT
PROXY

292
290
288
286

■
nondeposit

1/

/9

CREDIT
PROXY

'70

3o /. v

3 on-1

30 8.3

CREDIT
PROXY

3/?.y
3*0.3
33/3
3*7.2
333. o
3*73
3*4-1

323,Y
Current data appear in the Board's H.9 release.,
.................................................. ..... 1 1 i 1 1 1 1 1 1 1 1 1 1 1 I
Latest data plotted week ending: Sept. 23, 1970

_L 1 1 1 1 1 i 1 1 1 1 1 1 1 1 I I 1

I
9 23
July

6

20
Aug.


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

3 17
Sept.

1
1969

15 29 12 26
Oct.
Nov.

10 24
Dec.

7

21
Jan.

4

18
Feb.

4

18
Mar.

284

Total member bank deposits plus
items —
is sometimes referred to as the "adjusted credit
proxy." Member bank deposit figures are seasonally
adjusted, but nondeposit items are included in the
series on a seasonally unadjusted basis due to the
short period for which most items are available.
Nondeposit items included in the series are as fol_
_ lows: gross liabilities of banks to own foreign
.branches and to branches in U.S. territories and pos.'sessions; Euro-dollars borrowed directly from for­
- eign banks or through brokers and dealers; com­
— mercial paper issued by bank holding companies or
other bank affiliates; and loans or participations
in pools of loans sold under repurchase agreement
to other than banks and other than banks' own
affiliates or subsidiaries.
—
■
‘
"
"

M I I I 1 I I I Ml I
■i'll8 22 5
19 2
16
29 13 27 10 24
1 15
June
July Aug.
Sept.
May
Apr ,
1970
'

I II I II I ! I | M I I. -1_L
30

14 28
Oct.

11
25 9
23
Nov.
Dec.

6
20
Jan.
1971

282
280
278
276
.274
272
270
268
‘

0

‘

YIELDS ON SELECTED SECURITIES
srcges of Daisy 'Rates Ended Friday

11,00

1-1...L. i

'er Cent

11.00

J---1—L
3-Month 3-5
X teas u ry *
3111
1

Year ... Lon g-Xe rin__ Corporate
j

n-sV

7-1 S'

!

7-6/

\

7-£cj

j &.■96

7-7S

10.00

10.50

Lsj,

7'HX'
7‘i%

:

&■&/

i-7i
10.00

4-73

'

'?. 70

7:rk*

9.50

7.OS'
7 • Oi&

S. OS

Ml!

S.00

-yj— 3-5 Yaar 1
----- Govt. Sec

Three-Month \
Treasury Bill'

6.50

Market Yield
Discount Sate

5.00 •

Latest data plotted are averages of rates available for the week ending: Oct. 2, 1970

11

25

8

22

5

19


http://fraser.stlouisfed.orgOF SATES AVAILABLE
* AVERAGES
Federal Reserve Bank of St. Louis

3

17

31 14

28

12 26

9

23

6

20

6

20

3

17
Apr.

1

15
"9 12 26
10 24
Mat
June
July
1970 '

7
21
Aug.'

4 18
Sept.

2

16 30

13 27

Prepared by Federal Reserve Bank of St. Louis

11 25
Dec.

4

22

11
SELECTED SHORT-TERM INTEREST RATES
Averages of Daily Rates Ended Friday

Per- Gent

Per Cent

rWTTTl
Prime.
Commercial
Paper
4-6 Month

19 no

Prime
Bankers
Acceptances

90 Day
CD S **

7-5T
7 -iJ
7 33

tc tcO

7- Y5

736

10.0

Funds

too,
7'9T
7 9J

7- td

7.13

7-o£
y.J3
7-13

7 -SS

G3S

4.73

lo.OB

1,10

^■90
io.ee
i ■ \ >----i V -

i±HFP

i

i

Commercial Paper
4-to-6 Month

x

Bankers'
Acceptances

Federal Funds Kate

Discount Rate

k. 03

'Latest data plotted are averages«of rates available for the week ending:!0ct. 2, 1970

11 25
July

8 22
Aug.

5
19
Sept.

3

17 31 14
28 12 26
Oct.
Nov.
Dec.

9
23
Jan.

6

20
Feb.

1969


* AVERAGES OF RAXES AVAILABIE; FEDERAL FUNDS LAST FIVE DAYS AVAILABLE
http://fraser.stlouisfed.org SECONDARY MARKET RATE, WEEKLY AVERAGES ENDING WEDNESDAY
** DATA ARE
Federal Reserve Bank of St. Louis

6

20
Mar.

3
17
Apr.

1

15 29 12 26 10
24
May
June July
1970

7

21
Aug.

4
18
Sept.

2

16
Oct.

30

13 27
11 25 8
Nov.
Dec.

Prepared by Federal Reserve Bank of St. Louis

22
Jan.
1971

1 ion

BORROWINGS AND EXCESS RESERVES
All M©mb®r Bonks In the Nation
Averages orDaily Figures

of Dollars

',20 8

12
Millions of Dollars

cnrraTOFFpmi

,000

3,200

1 1 I 1 '■
FREE
BORROWINGS
RESERVES

3.000

EXCESS
RESERVES
sio

,800

'->yst
~ ISO I
-/<? 7?

,600

1<?S
/S3

IS.3I

,400

/ S't

/o to

&J13

mi

2,800
2,600
r2,400

- tfi£

& sI

,200
,000
,800

£o O

,600

cc3

2,200

Q.UO
k (*0

2.000
1,800

— ■YV-J

1,600

,400

Borrowings

1,400

,200

1,200

,000

1,000

800

800

600

600
Excess Reserves

400

400

200

200

0

0

200

-

1,000

-

1,200

-

1,400

-

,200

800

-

,000

600

-

800

400

-

600

200

-

400

1,600

Net Free Reserves

,400
,600
,800

-

1,800

000

-

2,000

200

-

2,200

400

-

2,400

600

-

2,600

-

2,800

-

3,000

800

Latest data plotted week ending: ;Sept. 30, 1970

000
9

23

6


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

20

3

17

1
1969

15 29
Oct,

12

2f
Nov,

10 24
Dec.

7

21
Jan.

4

18
Feb,

4 18
Mar.

1

15
29
Apr.

13 27
May

10 24 8 22
June
July
1970

5

19
Aug.

2

16 30
Sept.

14

28 11 25
Oct.
Nov.

Prepared by Federal Reserve Bank of St. Louis

9

23
Dec.

6

20
Jan.
1971

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