FOMC Minutes

Meeting of Federal Open Market Committee May 26, 1970 MINUTES OF ACTIONS A meeting of the Federal Open Market Committee was held in the offices of the Board of Governors of the Federal Reserve System in Washington, D. C., on Tuesday, May 26, 1970, at 9:30 a.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Mr. Burns, Chairman Hayes, Vice Chairman Brimmer Daane Francis Hickman Maisel Mitchell Robertson Sherrill Swan Morris, Alternate for Mr. Heflin Messrs. Galusha and Kimbrel, Alternate Members of the Federal Open Market Committee Messrs. Eastburn and Coldwell, Presidents of the Federal Reserve Banks of Philadelphia and Dallas, respectively Mr. Holland, Secretary Mr. Broida, Deputy Secretary Messrs. Kenyon and Molony, Assistant Secretaries Mr. Hexter, Assistant General Counsel Mr. Partee, Economist Messrs. Axilrod, Craven, Gramley, Hersey, Hocter, Jones, Parthemos, and Solomon, Associate Economists Mr. Holmes, Manager, System Open Market Account Mr. Bernard, Assistant Secretary, Office of the Secretary, Board of Governors Mr, Cardon, Assistant to the Board of Governors 5/26/70 Mr. Coyne, Special Assistant to the Board of Governors Messrs. Wernick and Williams, Advisers, Division of Research and Statistics, Board of Governors Mr. Keir, Associate Adviser, Division of Research and Statistics, Board of Governors Mr. Baker, Economist, Government Finance Section, Division of Research and Statistics, Board of Governors Miss Ormsby, Special Assistant, Office of the Secretary, Board of Governors Miss Eaton, Open Market Secretariat Assistant, Office of the Secretary, Board of Governors Messrs. Black, Fossum, and Baughman, First Vice Presidents, Federal Reserve Banks of Richmond, Atlanta, and Chicago, respectively Messrs. Eisenmenger, Link, Taylor, and Tow, Senior Vice Presidents, Federal Reserve Banks of Boston, New York, Atlanta, and Kansas City, respectively Messrs. Bodner, Scheld, and Green, Vice Presidents, Federal Reserve Banks of New York, Chicago, and Dallas, respectively Messrs. Gustus and Kareken, Economic Advisers, Federal Reserve Banks of Philadelphia and Minneapolis, respectively Mr. Sandberg, Securities Trading Officer, Federal Reserve Bank of New York By unanimous vote, the minutes of actions taken at the meeting of the Federal Open Market Committee held on May 5, 1970, were approved. The memorandum of discussion for the meeting of the Federal Open Market Committee held on May 5, 1970, was accepted. 5/26/70 By unanimous vote, the System open market transactions in foreign currencies during the period May 5 through 25, 1970, were approved, ratified, and confirmed. By unanimous vote, the open market transactions in Govern ment securities, agency obligations, and bankers' acceptances during the period May 5 through 25, 1970, were approved, ratified, and confirmed. By unanimous vote, the Federal Reserve Bank of New York was authorized and directed, until otherwise directed by the Committee, to execute transactions in the System Account in accordance with the following current economic policy directive: The information reviewed at this meeting indicates that real economic activity declined more than previously estimated in the first quarter of 1970, but little further change is projected in the second quarter. Prices and costs generally are continuing to rise at a rapid pace, although some components of major price indexes recently have shown moderating tendencies. Since early May most long-term interest rates have remained under upward pressure, partly as a result of continued heavy demands for funds and possible shifts in liquidity preferences, and prices of common stocks have declined further. Atti tudes in financial markets generally are being affected by the widespread uncertainties arising from recent international and domestic events, including doubts about the success of the Government's anti-inflationary program. Both bank credit and the money supply rose substantially from March to April on average; in May bank credit appears to be changing little while the money supply appears to be expanding rapidly. The over all balance of payments continued in considerable deficit in April and early May. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster financial conditions conducive to orderly reduction in the rate of inflation, while encouraging the resumption of sustainable economic 5/26/70 growth and the attainment of reasonable equilibrium in the country's balance of payments. To implement this policy, in view of current market uncertainties and liquidity strains, open market opera tions until the next meeting of the Committee shall be conducted with a view to moderating pressures on financial markets, while, to the extent compatible therewith, maintaining bank reserves and money market conditions consistent with the Committee's longer run objectives of moderate growth in money and bank credit. It was agreed that the next meeting of the Federal Open Market Committee would be held on Tuesday, June 23, 1970, 9:30 a.m. The meeting adjourned. Secretary at

Federal Reserve (1970, May 25). FOMC Minutes. Fomc Minutes, Federal Reserve. https://whenthefedspeaks.com/doc/fomc_minutes_19700526

@misc{wtfs_fomc_minutes_19700526,
  author = {Federal Reserve},
  title = {FOMC Minutes},
  year = {1970},
  month = {May},
  howpublished = {Fomc Minutes, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/fomc_minutes_19700526},
  note = {Retrieved via When the Fed Speaks corpus}
}