NEW YORK — The nation's basic money supply soared $3.1 billion in mid-August, the Federal Reserve Board reported Thursday, but the bigger-than-expected rise had virtually no response from the credit markets.
The Fed said the narrow measure of money known as M1 rose to a seasonally adjusted $688.1 billion in the week ended Aug. 18 from a revised $685 billion in the previous week. The previous week's figure originally was estimated by the Fed at $684.9 billion.
M1 includes cash in circulation, deposits in checking accounts and non-bank travelers checks.
Not Very Significant
For the latest 13 weeks, M1 averaged 672.9 billion, a 17.9% rate of gain from the 13 previous weeks. In its attempt to provide enough money to stimulate non-inflationary economic growth, the Fed has said it would like to see M1 grow in a range of 3% to 8% from the fourth quarter of 1985 through the final quarter of 1986. But the Fed also has said that M1 alone has relatively little significance in determining monetary policy.
In other reports:
- The Federal Reserve Bank of New York said commercial and industrial loans at major New York City banks fell $244 million in the week ended Aug. 20, compared to a decline of $293 million a week earlier.