Paul -
It appears that the growth of M3 last year, and particularly in Q4, may have been somewhat attributable to the pullout from Asia.
bog.frb.fed.us
The Monetary Aggregates:
>>Boosted in part by the need to fund substantial growth in depository credit, M3 shot up last year, expanding 8-3/4 percent; this growth was well above the 2 percent to 6 percent annual range, which was intended to suggest the rate of growth over the long run consistent with price stability. M3 was augmented by a shift in sources of funding--mostly at U.S. branches and agencies of foreign banks--from borrowings from related offices abroad, which are not included in M3, to large time deposits issued in the United States, which are. Also contributing to the strength in M3 was rapid growth in institution-only money funds, which reflected gains by these funds in the provision of corporate cash management services. Corporations that manage their own cash often keep their funds in short-term assets that are not included in M3.<<
bog.frb.fed.us
>>3. Consists of M2 plus large-denomination time deposits (in amounts of $100,000 or more), balances in institutional money funds, RP liabilities (overnight and term) issued by all depository institutions, and Eurodollars (overnight and term) held by U.S. residents at foreign branches of U.S. banks worldwide and at all banking offices in the United Kingdom and Canada. Excludes amounts held by depository institutions, the U.S. government, money funds, and foreign banks and official institutions. Seasonally adjusted M3 is calculated by summing large time deposits, institutional money fund balances, RP liabilities, and Eurodollars, each adjusted separately, and adding this result to seasonally adjusted M2.<< |
