Monday, 17 February 2014

U.S. Money, Credit & Treasuries Review (as of 5 February 2014)

Based on the most recent data from the Federal Reserve, the tables below depict key movements in the monetary base, money supply, bank credit (including loans & leases) and treasury yields (the latter as of 14 February 2014) for the bi-weekly period ending 5 February 2014:

The U.S. monetary base increased to USD 3.7775 trillion for the bi-weekly period ending 5 February 2013. The base has increased USD 26.6 billion, or 0.71%, since week ending 25 December 2013. Compared to the same period last year, the base increased 33.95%. Though a substantial increase, this year on year (YoY) increase was the lowest since the bi-weekly period ending 18 September last year.

Go here for a recap of 2013.

The M2 money supply increased 5.85% compared to the same period last year, up from the 5.50% reported two weeks ago and the 4.87% reported four weeks ago. The current YoY growth rate remains substantially lower that it was in 2011 and 2012 and lower than the 6.80% average for 2013. Bank credit continues to expand at an historically low pace, increasing just 1.30% on a year on year basis for the week. This compares to an average YoY growth rate of 6.44% since 1985.

The 1- and 10-year treasury yields increased one and two basis point on two weeks ago and have declined one and 24 basis points respectively since 27 December last year while the spread as a result has narrowed by 23 basis points.