NEW YORK — The Federal Reserve Board said Thursday that its most basic measure of the U.S. money supply jumped $9.9 billion in late November. But it also reported less growth in two broader measures of money than most analysts had expected.
That news cheered the credit markets, where prices retraced some of the ground they lost earlier in the day.
Prices of some 30-year Treasury bonds, which had been down three quarters of a point before release of the money report, regained a quarter point to finish the day only a half point lower--about $5 for every $1,000 in face value. Short-term interest rates were unaffected by the report.
Analysts said the two broader money measures are now both within the central bank's growth targets, diminishing chances that the Fed will find it necessary to tighten its credit policy. The targets were set to assure steady but non-inflationary economic growth.
The Fed said the measure of basic money supply, known as M1, rose to a seasonally adjusted $721.4 billion in the week ended Dec. 1 from a revised $711.5 billion the previous week, originally reported as $711.6 billion. M1 includes cash in circulation, deposits in checking accounts and non-bank travelers checks.