Recent Updates
- Japan: Wage Indexes, Hours Worked (May), TSE Tokyo PRO Market, Machine Tool Orders (Jun)
- Korea: 20 Days of Trade, Tourist Arrivals (Jul), Foreign Investment (Q2), Loans to Households and Enterprises (May); Hong Kong: Personal Bankruptcy Petitions (Jun); Pakistan: Credit by Borrowers (Jun); China: Fixed Assets Investment (Jun), GDP, Construction Output (Q2)
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Economy in Brief
German PPI Rises at Nine-Month High Pace
The German PPI gained 0.2% in June on the heels of a 0.6% rise in May...
U.S. Leading Economic Indicators Improve
The Conference Board's Composite Index of Leading Economic Indicators increased 0.5% (5.8% y/y) during June...
Philadelphia Fed Factory Conditions Recover; Prices Surge
The Philadelphia Fed reported that its General Factory Sector Business Conditions Index rebounded to 25.7 during July...
U.S. Initial Unemployment Insurance Claims Hit Lowest Since 1969
Initial claims for unemployment insurance dropped to 207,000 during the week ended July 14...
Japan's Trade Deficit Swings Back to Surplus (Small Surplus)
Japan's early June trade results show a goods trade position having swung back to surplus in June from deficit in May...
by Tom Moeller June 27, 2005
Liquidity growth in the US has slowed markedly this year versus the charged growth rates during the prior three years. Growth during the last three months in the adjusted monetary base fell to 1.2% versus 5.3% growth last year and 8.6% growth during 2002.
Contributing to this slowdown, if not causing it, has been the increase in the targeted interest rate for Fed funds to 3.0% from 1.0%.
Growth in MZM also has slowed to 0.8% during the last three months versus 3.9% during 2004 and 13.0% growth during 2002. The pickup in the most recent MZM growth rate from below zero may indicate continued life for consumer spending.
A Neutral Federal Funds Rate? from the Federal Reserve Bank of St. Louis can be found here.
| Money Supply | 6/22/05 (13 Week %, AR) | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|
| Adjusted Monetary Base | 1.2% | 4.4% | 5.3% | 6.3% | 8.6% |
| MZM | 0.8% | 0.5% | 3.9% | 7.4% | 13.0% |
