§ 38. Mr. Higginsasked the Chancellor of the Exchequer how the percentage 71W increase in £M3 over the latest three-month period for which figures are available, expressed at an annual rate, compares with the corresponding figure for the same three months in 1973–74.
§ Mr. Denzil DaviesThe most recent figures available relate to the three months to mid-January. During this period, sterling M3 grew at an annual rate of about 16½ per cent.—seasonally adjusted. The equivalent figure for the three months to mid-January 1974 was about 24 per cent.
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer, in the light of the fact that the money supply rose in January taking the increase over the first nine months of the current financial year to just under 11 per cent., this being equivalent to an annual growth of 14.75 per cent., how much this is above his target range; what action he proposes to change the situation; and whether this will include reducing the total number of unemployed.
§ Mr. Denzil DaviesIn the month to mid-January the sterling M3 measure of money supply grew by about 2¼ per cent., a rate of growth above the desired trend of 9 per cent.-13 per cent. at an annual rate. This high figure can be accounted for largely by the once-and-for-all effects of the tax refunds resulting from the reliefs which my right hon. Friend announced in October. The underlying trend rate of growth is, therefore, well below this. My right hon. Friend is confident that the next few months will show that trend to be within the desired range. There have so far been no developments in the monetary situation which call for corrective action, though the position is kept under continuous review. Continuing control of the money supply will assist the achievement of our counter-inflation objectives, which are of particular importance for the future growth of employment.
§ Mr. Lawsonasked the Chancellor of the Exchequer if he will publish a table showing the percentage annual rate of growth of the money supply, quarter by quarter, from the first quarter of 1974 to the last quarter of 1977, the money supply being defined as £M3, and the rate of growth for each quarter being defined as the seasonally adjusted increase in 72W £M3 at the end of the quarter over the comparable figure for the end of the preceding quarter, expressed as an annual rate.
§ Mr. Denzil DaviesThe information is as follows:
END CALENDAR QUARTER AND THREE-MONTH PERCENTAGE GROWTH IN STERLING M3 EXPRESSED AT AN ANNUAL RATE: 1974 1st quarter … … + 10.3 2nd quarter … … + 2.3 3rd quarter … … + 10.5 4th quarter … … + 18.5 1975 1st quarter … … + 2.5 2nd quarter … … + 8.3 3rd quarter … … + 14.0 4th quarter … … + 2.3 1976 1st quarter … … + 5.1 2nd quarter … … + 13.1 3rd quarter … … + 17.3 4th quarter … … + 1.5 1977 1st quarter … … + 0.7 2nd quarter … … + 13.5 3rd quarter … … + 9.4 NOTES:
(i) All figures are seasonably adjusted.
(ii) Figures for the end of the fourth quarter of 1977 are not yet available.