§ Mr. Ron Thomasasked the Chancellor of the Exchequer if he will set out the calculations in each case by which the actual figure for M3 growth of +£98 million in January 1978 was transformed into a seasonally adjusted figure of +£982 million, the actual figure for M1 growth was seasonally adjusted from an actual figure of -£231 million to +£681 million, and the domestic credit expansion figure was seasonally adjusted from -£386 million to +£354 million.
§ Mr. Denzil DaviesThe change in sterling M3 growth and its counterparts including DCE, with and without seasonal adjustment, in banking January was as follows:
adjustment, in banking January was as follows:
321WIn preparing these seasonal adjustments the Bank of England takes account of past deviations of a seasonal nature that can be expected to recur, of changes known to have occurred in the seasonal pattern of the Government's own operations, and of changes that arise as a result of the particular dates on which a banking month begins and ends. The seasonal adjustments in banking January were large, for three main reasons:
- (1) Companies' annual payments of mainstream corporation tax and payments of some other direct taxes are concentrated in January, increasing central Government receipts and also running down sterling sight deposits.
- (2) The clearing banks debit in January half-yearly interest on their lending thereby increasing bank lending to the private sector.
- (3) The public's holdings of notes and coin customarily fall in the period immediately following Christmas.