For release at 4:30 PM EST H.3 (502) March 21, 2002 SPECIAL NOTICE Measures of reserves and the monetary base have been revised to incorporate the results of the annual break factor and seasonal factor reviews. Break-adjusted and seasonally adjusted data (Table 1 of the release) were revised in most cases by less than $1.0 billion in a maintenance period, with maximum revisions of $2 billion for reserves and $2.4 billion for the monetary base. Break factors remove discontinuities (or "breaks") associated with regulatory changes in reserve requirements, such as the annual indexations of the low reserve tranche and the reserve requirement exemption levels.1 Break-adjusted data (Table 3 of the release) incorporate updated break factors. The revisions from this source begin in January 2001 and do not exceed $70 million in any maintenance period. Seasonal factors for required reserves and the surplus vault cash component of the monetary base have been re-estimated using the revised break-adjusted data, after excluding the estimated effects of the September 11, 2001 terrorist attacks. The revisions due to re-estimated seasonal factors start in February 1984, and they are the major source of the revisions to break-adjusted, seasonally adjusted data. A more detailed description of the methods for constructing the break factors and seasonal factors for the measures of reserves and the monetary base, as well as printed tables of the revised historical data, will soon be available from the Monetary and Reserve Analysis Section, Division of Monetary Affairs, Mail Stop 72, Board of Governors of the Federal Reserve System, Washington, D.C. 20551, (202) 452-3062. Complete historical data are available each week through the Federal Reserve's web site (http://www.federalreserve.gov/releases/) with the H.3 statistical release. The data are also available through other electronic means, as described in the note at the end of table 3 of this release. 1. The Monetary Control Act of 1980 established a reserve ratio of 3 percent against the first $25 million in net transaction deposits (low reserve tranche) at each depository institution. Since 1982, the low reserve tranche has been indexed each January by 80 percent of the previous year's (June 30 to June 30) growth rate of net transaction deposits at all depository institutions. At present, the low reserve tranche is $41.3 million. Under the Garn-St Germain Depository Institutions Act of 1982, the first $2 million of reservable liabilities of each depository institution was exempted from reserve requirements. Since 1983, this exemption amount has been indexed each year by 80 percent of the rate of increase of the reservable liabilities at all depository institutions over the preceding year (June 30 to June 30). At present, the reserve exemption level is $5.7 million. Both of these indexations take effect each year in a reserve maintenance period that begins around January 1 for weekly respondents to the FR 2900 report. 1 FEDERAL RESERVE STATISTICAL RELEASE H.3 (502) Table 1 For Release at 4:30 p.m. Eastern Time March 21, 2002 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND THE MONETARY BASE Adjusted for changes in reserve requirements1 Averages of daily figures, seasonally adjusted unless noted otherwise Millions of dollars ------------------------------------------------------------------------------------------------------------------------------------------- Reserves of depository institutions Borrowings of depository institutions from the Federal Reserve, NSA --------------------------------------------------- -------------------------------------------------- Date total2 nonborrowed3 required excess NSA4 Monetary total adjustment seasonal extended base5 credit ------------------------------------------------------------------------------------------------------------------------------------------- 2001-Feb. 38382 38331 36875 1507 589886 51 30 21 0 Mar. 38460 38402 37061 1399 592272 58 38 20 0 Apr. 38568 38517 37291 1277 595638 51 15 35 0 May 38316 38103 37297 1019 598894 213 134 79 0 June 39066 38836 37704 1362 602835 229 110 120 0 July 39785 39502 38377 1408 608105 283 109 174 0 Aug. 40079 39895 38870 1209 616025 183 19 164 0 Sep. 58214 54829 39195 19019 639717 3385 3292 93 0 Oct. 45655 45528 44334 1321 630510 127 60 67 0 Nov. 40904 40820 39417 1487 629596 84 51 33 0 Dec. 41099 41032 39459 1641 634549 67 34 33 0 2002-Jan. 41510 41460 40105 1405 640882 50 33 17 0 Feb. 41058 41028 39685 1373 646028 30 12 17 0 Two weeks ending 2002-Jan. 23 41315 41287 40072 1243 640898 28 15 14 0 Feb. 6 41356 41330 39957 1398 644103 26 8 18 0 20 40875 40838 39461 1414 645850 37 17 20 0 Mar. 6 41154 41132 39872 1282 647783 22 9 13 0 20p 40642 40618 39378 1264 648234 24 4 20 0 --------------------------------------------------------------------------------------------------------------------------------------------- 1. Reserves and monetary base figures incorporate adjustments for discontinuities, or "breaks", associated with regulatory changes in reserve requirements. (For more information, see Table 3). 2. Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break-adjusted required reserves plus unadjusted excess reserves. (Also, see footnote 2 on Table 2 and footnote 2 on Table 3.) 3. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted, break-adjusted total reserves less unadjusted total borrowings of depository institutions from the Federal Reserve. 4. Excess reserves NSA equals unadjusted total reserves (Table 2, column 1) less adjusted required reserves (Table 2, column 3). 5. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally adjusted, break-adjusted total reserves plus (2) the seasonally adjusted currency component of the money stock plus (3), for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds their required reserves, the seasonally adjusted, break-adjusted difference between current vault cash and the amount applied to satisfy current reserve requirements. (Also see footnote 3 on Table 2 and footnote 4 on Table 3.) p preliminary 1 H.3 (502) Table 2 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND THE MONETARY BASE Not adjusted for changes in reserve requirements1 Averages of daily figures, not seasonally adjusted Millions of dollars ------------------------------------------------------------------------------------------------------------------------------------------- Reserves of depository institutions Vault cash5 -------------------------------------- -------------------------------------- Reserve used to Net carryover Date total2 nonborrowed required Monetary base3 balances total satisfy surplus7 of reserve with F.R. required balances8 Banks4 reserves6 ------------------------------------------------------------------------------------------------------------------------------------------- 2001-Feb. 39307 39256 37800 595517 6542 48530 32765 15765 Mar. 37723 37666 36324 598195 6733 44127 30991 13136 Apr. 38589 38538 37312 601841 6860 43672 31729 11943 May 39374 39161 38355 605475 7604 43267 31771 11497 June 38217 37988 36855 608812 7043 43139 31174 11966 July 39337 39054 37929 615577 7693 43910 31644 12266 Aug. 39668 39484 38459 622038 7578 44007 32090 11917 Sep. 57567 54182 38549 645753 25633 43436 31934 11502 Oct. 45061 44934 43739 636449 12552 45021 32509 12512 Nov. 40158 40074 38672 637865 8944 43065 31214 11851 Dec. 40955 40888 39315 648889 9059 43918 31896 12023 2002-Jan. 43474 43424 42069 653310 10009 45731 33465 12266 Feb. 42090 42060 40717 654732 9277 45699 32813 12886 Two weeks ending 2002-Jan. 23 43215 43187 41971 651692 10646 43724 32569 11155 40 Feb. 6 45235 45210 43837 651516 9191 50352 36044 14308 61 20 41244 41207 39830 655106 8985 45422 32259 13163 92 Mar. 6 41213 41192 39931 656489 9853 42696 31360 11335 113 20p 39094 39070 37830 657122 8543 42272 30551 11721 11 -------------------------------------------------------------------------------------------------------------------------------------------- 1. Reflects actual required reserves, with no adjustments to eliminate the effects of discontinuities, or "breaks", associated with regulatory changes in reserve requirements. 2. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy reserve requirements. 3. The monetary base, not break-adjusted and not seasonally adjusted, consists of (1) total reserves plus (2) required clearing balances and adjustments to compensate for float at Federal Reserve Banks plus (3) the currency component of the money stock plus (4), for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds their required reserves, the difference between current vault cash and the amount applied to satisfy current reserve requirements. Currency and vault cash figures are measured over computation periods ending on Mondays. 4. Excludes required clearing balances and adjustments to compensate for float and includes other off-balance sheet "as-of" adjustments. 5. Vault cash eligible to satisfy reserve requirements. It includes only vault cash held by those banks and thrifts that are not exempt from reserve requirements. Dates refer to the maintenance periods in which the vault cash can be used to satisfy reserve requirements. 6. All vault cash held during the lagged computation period by "bound" institutions (i.e., those whose required reserves exceed their vault cash) plus the amount of vault cash applied during the maintenance period by "nonbound" institutions (i.e., those whose vault cash exceeds their required reserves) to satisfy current reserve requirements. 7. Total vault cash eligible to satisfy reserve requirements, held by depository institutions not exempt from reserve requirements, minus the amount used to satisfy reserve requirements. 8. Consists of carryover only at depository institutions maintaining reserves on the basis of two-week maintenance periods. Reflects excess (+) or deficit (-) reserves eligible to be carried forward into the two-week reserve maintenance period ending on the date shown. p preliminary 1 H.3 (502) Table 3 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND THE MONETARY BASE Adjusted for changes in reserve requirements1 Averages of daily figures, not seasonally adjusted Millions of dollars --------------------------------------------------------------------------------- Reserves of depository institutions --------------------------------------- Date total2 nonborrowed required3 Monetary base4 ---------------------------------------------------------------------------------- 2001-Feb. 39325 39274 37818 588962 Mar. 37753 37696 36354 591357 Apr. 38631 38581 37354 594914 May 39430 39217 38410 598559 June 38283 38054 36921 601667 July 39418 39135 38009 608235 Aug. 39759 39576 38550 614551 Sep. 57676 54291 38657 637995 Oct. 45188 45061 43867 628340 Nov. 40287 40203 38801 629897 Dec. 41073 41007 39433 640058 2002-Jan. 43460 43411 42055 644295 Feb. 42072 42042 40699 645509 Two weeks ending 2002-Jan. 23 43201 43173 41958 642633 Feb. 6 45222 45196 43823 642538 20 41226 41189 39812 645688 Mar. 6 41189 41168 39907 647423 20p 39065 39041 37801 647753 1. Figures reflect adjustments for discontinuities, or "breaks", associated with regulatory changes in reserve requirements. 2. Break-adjusted total reserves equal break-adjusted required reserves (Table 3, column 3) plus excess reserves NSA (Table 1, column 5). 3. To adjust required reserves for discontinuities due to regulatory changes in in reserve requirements, a multiplicative procedure is used to estimate what required reserves would have been in past periods had current reserve requirements been in effect. Break-adjusted required reserves are equal to break-adjusted required reserves against transactions deposits. 4. The break-adjusted monetary base equals (1) break-adjusted total reserves plus (2) the (unadjusted) currency component of the money stock plus (3), for all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds their required reserves, the break-adjusted difference between current vault cash and the amount applied to satisfy current reserve requirements. p preliminary Note: Current and historical H.3 data are available each week on the Federal Reserve Board's web site (http://www.federalreserve.gov/). Monthly data are available back to January 1959, and weekly data are available back to January 1975 for most series. For information about individual copies or subscriptions, contact Publications Services at the Federal Reserve Board (phone 202-452-3245, fax 202-728-5886). For paid electronic access to current and historical data, call STAT-USA at 1-800-782-8872 or 202-482-1986.