NEW YORK — The nation's basic money supply rose by $2.3 billion in early September, the Federal Reserve Board reported Thursday, but the increase was consistent with expectations and had no effect on the credit markets.
The Fed said M1 rose to a seasonally adjusted $695.3 billion in the week ended Sept. 8 from $693 billion in the previous week. M1 includes cash in circulation, deposits in checking accounts and non-bank travelers checks.
For the latest 13 weeks, M1 averaged $679.5 billion, a 17.6% seasonally adjusted annual rate of gain from the previous 13 weeks.
The Fed, in its attempt to provide enough money to stimulate non-inflationary economic growth, 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 Fed officials also have said they are paying little attention to the rapid growth of M1, preferring instead to focus on broader measures of monetary expansion and other economic indicators.
The $2.3-billion rise was well within range of analyst estimates assembled by Money Market Services, a California-based financial services company.
In other reports:
- The Federal Reserve Bank of New York reported that commercial and industrial loans at major New York City banks fell $633 million in the week ended Sept. 10, compared to a revised gain of $663 million in the previous week.
- The Federal Reserve said bank borrowings from the Federal Reserve System averaged $519 million in the two weeks ended Sept. 10, up from $395 million.
- The Federal Reserve said total adjusted reserves of member banks averaged $51.748 billion in the two weeks ended Sept. 10, up from $51.641 billion.
- The Federal Reserve Bank of St. Louis reported that the monetary base, the seasonally adjusted total of member bank reserves held at Federal Reserve banks and cash in bank vaults and in circulation, was $249.4 billion in the two-week period ended Sept. 10, up from $247.8 billion two weeks earlier.