ECONOMIC INTELLIGENCE WEEKLY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001500150051-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 22
• Document Creation Date: December 22, 2016
• Document Release Date: September 29, 2009
• Sequence Number: 51
• Publication Date: November 27, 1974
• Content Type: REPORT

Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
25X1
Secret
Economic Intelligence Weekly
Secret
CIA No. 8230/74
27 November 1974
Copy N2 205
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Secret
ECONOMIC INTELLIGENCE WEEKLY
Developed Countries: Meager Expansionary Efforts . . . . . . . . . . 3
Canada: Economic Slowdown Arrives . . . . . . . . . . . . . . . . 7
.......... 8
World Auto Industry on Downgrade . . . . . . . . . . . . . . . . . 10
South Asian Grain Situation: Poor Prospects . . . . . . . . . . . . . 11
USSR: Blue-Chips Financial Status . . . . . . . . . . . . . . . . . 13
Notes, Publication of Interest, Statistics
Concern About Inflation has kept major countries from doing much to spur
economic recovery. As sales continue to drop and unemployment grows, mounting
political pressures probably will bring hard action by early 1975. Canada already
is moving to maintain employment, at the expense of fighting inflation. Several
smaller countries also have embarked on expansionary programs, with Australia,
the Netherlands, New Zealand, and South Korea in the vanguard.
The Current Account Deficits of OECD Countries in 1975 will match the
$40 billion total of 1974. This estimate, by the OECD Secretariat, assumes that
the expansion of sales to oil producing nations will offset the decline in exports
to non-oil LDCs. The Secretariat foresees an appreciable improvement in the current
account balance of Japan, a continued large West German surplus, and a
considerable worsening for the United States and the smaller OECD countries.
The First Followup Meeting to the World Food Conference will be held in
Rome on 29 November under FAO auspices. Discussion will center on the
immediate grain needs and financing problems of the larger grain importers,
particularly south Asian countries. Major grain exporters, including the United
States, will participate.
Note: Comments and queries regarding the Economic Intelligence Weekly arc welcomed, may be directed
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
secret
World Grain Supplies continue to tighten, especially wheat. The most recent
setback occurred in Argentina, where drought has lowered the crop by at least 10%.
Neighboring countries dependent on Argentine wheat may have to look to the
United States (as occurred last year) or to other sources for additional supplies
in 1975.
Copper Traders were unimpressed by the decision of the Intergovernmental
Council of Copper Exporting Countries -- Chile, Zambia, Zaire, and Peru .. to trim
exports 10%. Prices on the LME continue to fall. Several US producers dropped
prices by 3 cents a pound and others are expected to follow.
Note: Changes in Economic Indicators
Several changes in the economic indicators are introduced this week. The tables
for Industrial Production, Domestic Prices, and Foreign Trade are now accompanied
by charts showing the course of these series since the beginning of 1972. The
charts are semilogarithmic, so that the steepening or flattening of a plotted line
represents an increasing or decreasing rate of change of the underlying data. The
index number at the end of each plotted line relates to the date of latest
information, which is given in the table to the right of the chart.
The table on Retail Sales has been changed from a current-price to a
constant-price basis. Large increases in retail prices have made the current-price
series rise rapidly even where the physical volume of sales has been falling.
Because wages are an important element in the inflationary spiral as well as
in international competitiveness, a table on Wages in Manufacturing (in money
terms) has been added. Although coverage of the series differs from country to
country, the wage data shed light on an important range of policy issues confronting
each country.
2
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
DEVELOPED COUNTRIES: MEAGER EXPANSIONARY EFFORTS
Reflation of the developed foreign economies so far has been more a matter
of talk than of action. Government still are in the throes of deciding on policy
adjustments, which initially will be cautious and selective. A few smaller countries
have embarked on expansionary programs, with small prospects for success unless
their chief trading partners follow suit.
Extreme concern over inflation has induced most countries to hold back on
expansionary measures despite growing pressures for action. But with production
falling and unemployment mounting, various leaders are questioning the wisdom
of current policy. Several governments fear reprisals from voters alienated by stiff
anti-inflation programs, and all fear the collapse of businesses strapped by declining
profits and tight credit.
Practically all the developed countries have kept a tight rein on the money
supply; short-term interest rates are dropping only because of reduced demand
for loans and the influx of oil money. Cautious fiscal moves recently announced
in several countries will hardly result in early recovery of output. The United
Kingdom, a vocal advocate of reflation elsewhere, has revised its budget in ways
that will add little net stimulus to overall demand. West Germany continues to
offer the political sop of minute outlays from its countercyclical funds and minor
adjustments in central bank rates. Canada has announced the most substantial
action, planning a more expansionary fiscal policy for the next two years.
As production continues to drop and unemployment mounts, political
pressures will bring positive action to prevent further det(:rioration, some time in
early 1975.
West Germany
The Schmidt government has done little so far to snap the economy out of
its lethargy. In September, a month before state elections in Bavaria and Hesse,
it announced a $380 million injection of countercyclical funds into regional
investment projects. About $4 billion remains to be used. In response to
international pressures, the Bundesbank in October lowered the discount and Lom-
bard rates by one-half percentage point and increased available funds by $1 billion.
3
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
1-1
Developed Countries: Economic Indications
Unemployment
Industrial Production
Export Volume
'50 1-- I All serfes are seasonally adju,ted, 1973=100
II III
1973
I II III IV I
*Projeclad 1973
II III
1974
II III IV'
1971
4
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Secret
In adopting belt-loosening measures, Bonn feels constrained by a tax reform
package -- long-scheduled to take effect this January -- that will add an estimated
$6 billion annually to consumer purchasing power. This tax relief will help push
the combined deficit of federal and local governments to $20 billion in 1975,
compared with $13 billion in 1974 and $1 billion in 1973. Recent forecasts that
unemployment will hit the I million mark (4%) this winter have enlivened
intra-government debate on economic policy. In the end, Bonn probably will put
together an antirecession program that looks larger than it actually is - a tactic
that all factions agree on.
Paris is now reconsidering the austerity program launched last June, which
was aimed at depressing domestic demand in order to quell inflation and balance
the trade account by the end of 1975. A weak political position has forced President
Giscard to aim restrictive measures at business and investment instead of the
consumer. Business will have to foot most of the bill for a new program guaranteeing
a year's take-home pay for laid-off workers. Because production is leveling off
and inflation has slowed to a 13% annual rate, Paris is likely to ease credit restraints
soon while retaining the higher corporate tax rates.
United Kingdom
In its recent revised budget, London has assured that deficit spending will
continue to offset the contractionary impact of increased outlays for oil imports.
While adding little stimulus to overall demand, the budget brings a needed shift
in resources from consumers to business. If employment continues to fall, Whitehall
probably will follow up with more fiscal stimulus in the spring. Large inflows of
oil money into Treasury bills and other government securities have permitted the
Labor government to finance a huge budget deficit without printing money. Its
continued ability to do so depends on the attractiveness of the London market --
a factor that inhibits the government's freedom to adjust monetary policy.
Italy
In spite of a prolonged political crisis and increasing resistance from powerful
labor unions, Rome is forced to stand by its austerity program. The alternative
is bankruptcy in the eyes of its foreign creditors and suppliers. Nonetheless, since
Italy's current 15% credit ceiling -- a condition attached to an IMF loan - expires
in March, the government would have ample time to ease its monetary policy
slightly before June regional elections. Bureaucratic tie-ups make limits on
5
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
Secret
government spending difficult to enforce. Escalating political problems and wage
demands will increase the temptation to shift to a more expansionary posture.
are difficult to enforce. Escalating political problems and wage demands will increase
the temptation to shift to a more expansionary posture.
Japan
Despite a sharp deterioration in economic activity, restrictive policies probably
will be maintained for several more months. The primary short-term goal is to
halve the 30% pay hikes labor intends to garner next spring. In the meantime,
Tokyo is cautiously trying to bail out a few hard-pressed firms and is considering
an expansion of the unemployment benefits. Tanaka's resignation could lead to
a loosening of economic policy. Of the two leading contenders for his position,
Finance Minister OWra and former Finance Minister Fukuda, the latter would be
more inclined to maintain present policies.
Canada is trying to loosen up on fiscal policy, which has been unexpectedly
contractionary because inflation has boosted government receipts. Ottawa plans
to run a budget deficit of $350 million in the second half of FY 1975 and a
$1 billion deficit in FY 1976. The government also intends to provide substantial
relief to low-income consumers. This fiscal stimulus may be offset by a sharp rise
in the current account deficit.
Monetary policy is also expected to ease. A small decline in short-term interest
rates since midyear reflects softer demand for loans and a drop in US rates.
Other Countries
Among the smaller industrial countries, Australia and the Netherlands have
adopted the most expansionary programs. The Wlutlam government has cut taxes,
reduced interest rates on Treasury notes, and eased restrictions on foreign
borrowing. The new Dutch budget will boost public spending enough to provide
jobs for one-third of the unemployed and will reduce taxes on lower-income groups
and small businessmen.
Other countries are considering milder reflation measures. Belgium has relaxed
credit ceilings. Spain intends to increase public spending and tax incentives for
private investment, at the same time imposing price controls and import quotas.
6
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Secret
The new Greek government under Karamanlis is expected to confirm the cautious
reflationary policy chosen by the military junta before its ouster.
Several countries will oppose a drift toward reflation. The Danes, Swiss,
Austrians, and Irish still appear to emphasize control of inflation and trade deficits.
Worried about the impact of an oil boom, the Norwegians are considering a shift
to tighter monetary and fiscal policies.
CANADA: ECONOMIC SLOWDOWN ARRIVES
The worldwide economic downturn has caught up with Canada. After growing
at an annual rate of 5-1/2% in the first half-the highest for any developed
country-Canadian GNP will register only a small gain in the current half. Growth
will be far below normal in 1975, given the poor prospects for the US economy.
Domestic demand began to CANADA: Production Down; Prices Up
lose momentum in the second
quarter and weakened further in 130
the third. Despite record wage
hikes, growth in real household
spending has slackened because of
tight consumer credit, shortened
work hours, and the 11-1/2% in- 120
flation rate. The investment boom Industrial Production
has fallen victim to high interest (seasonally adjusted)
rates, rising construction costs,
and uncertain business prospects.
Housing starts are running 30% be- 110
low the first-half average, and new
machinery orders are down in real
terms.
The sharp decline in US de-
mand, which absorbs about half of
Canadian goods output, is a prime
~IIIIIIIII
100
1971 1972 1973 J F M A M J J A S 0
Monthly Average 1974
7
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
reason for the 2% drop in industrial production since June. Overall export vol-
ume, seasonally adjusted, fell 4% in the second quarter and 9% in the third
quarter-the steepest decline in any industrial country. Further cuts in production
are likely, over the next few months, since the ratio of manufacturers' inventories to
sales is at a two-year high.
The unemployment rate of 5-1/2%, still slightly below the 1973 average, prom-
ises to rise in the months ahead. The important auto industry is already planning
layoffs because of sagging US purchases. Unions nonetheless continue to push large
wage demands, with recent settlements calling for 14% hikes, compared with 10%
gains earlier this year. Growing wage costs will give another push to inflation because
labor productivity probably will stagnate in the current half year.
Expansionary features of the revised budget, recently proposed for the year
ending 31 March 1975, should bring only a small gain in Canadian output in 1975.
Recovery to the long-term growth rate of 5-1/2% depends on a strong recovery in
US demand for Canadian goods.
8
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
WORLD AUTO INDUSTRY ON DOWNGRADE
The world automobile industry, faced with rising production costs and
shrinking demand, is heading for the sharpest contraction since the 1930s. Even
when the major industrial countries recover from the global economic slowdown,
the industry in the developed nations will not regain its proud position as a key
growth sector.
So far in 1974, automakers have seen sales around the world drop by 20%,
with the aacline currently approaching 40%. Orders for trucks - which had been
a bright spot - have begun to plummet because of decreased capital spending.
? West Germany: One-third to one-half of the auto workers have been laid
off or have been placed on short time.
? Italy: Fiat has put 71,000 workers on a three-day week for the next
four months.
10
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Secret
? France: Some firms such as Citroen, which lost $82 million in the first
half' of 1974, have merged or sought alliances with other firms; large
layoffs are in sight in a few weeks.
? United Kittgdont: Although British automakers have succeeded in
recapturing the home market, internal economic retrenchment will force
down future demand.
? Japan; With their "lifetime" labor force, Japanese manufacturers have
tried to offset declining world sales by shifting production workers into
clerical and sales jobs and are even thinking of marketing refrigerators
and other appliances through their dealer network.
Share of World Motor Vehicle Production
1973
United States
33
Canada
4
Japan
18
EC
31
Communist countries
6
Other
8
Over the long term, demand for autos will grow fastest in the LDCs, notably
in Latin America. The larger developing nations are rapidly expanding their own
automobile industries and are beginning to take over the markets in other developing
countries. This growth in LDC manufacturing centers, together with expansion of
Communist automaking capacity and the reassessment of the automobile's role in
the developed nations, will speed a restructuring of the industry worldwide
SOUTH ASIAN GRAIN SITUATION: POOR PROSPECTS
The four major grain importing countries of South Asia - India, Bangladesh,
Pakistan, and Sri Lanka - face at least another year of serious shortages. These
countries have arranged for imports of about 9 million tons of grain in FY 1975,
and we expect them to seek at least an additional 2 million tons. Practically all
11
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Secret
of the grain supplies in FY 1975 will be consumed, leaving little to rebuild the
depleted stocks. All four countries will be extremely vulnerable to adverse weather
during the first half of 1975.
The major grain harvest -- normally two-thirds of annual grain production -
is now under way. Because the summer rains were below normal, a harvest of
58 million to 60 million tons is projected for the current crop year, compared
with 67 million tons last year. New Delhi has already arranged grain imports of
nearly 6 million tons for FY 1975 and is expected to seek another million tons
or more. The augmented level of imports is believed sufficient to maintain
government distribution in urban areas. Grain reserves, however, will be practically
depleted.
Even with favorable weather, India will need further gain imports early in
FY 1976. Requirements could increase sharply if poor weather again retards the
winter gain crops - harvested in April and May - as it did last year. Fertilizer
consumption, which proved to be a key element in raising grain output in the
last decade, is expected to remain at about the level of the past two years.
Bangladesh
The major rice harvest now under way normally provides 60fo of annual grain
production. This harvest is estimated at 7 million tons, slightly above last year's
6.8 million tons, thanks to the heavy rains of last summer. Bangladesh depends
on annual grain imports of about 2 million tons, largely for urban distribution.
Dacca has arranged 1.4 million tons of imports for FY 1975; acquisition of the
balance is contingent on additional foreign aid.
While the current rice and coarse grain harvest - 30% of annual gain
production -- is down slightly from last year because of a poor summer monsoon,
rice exports of nearly 500,000 tons probably will be maintained. Concern is being
voiced over water supplies for irrigation of the winter wheat crop harvested in
April and May because rivers and reservoirs are far below normal for this season.
Favorable rains between now and February could alleviate this situation.
Nonetheless, anticipating difficulties, Islamabad recently redefined its FY 1975
wheat import requirement from 1. 14 million to 1.5 million tons in hopes of securing
12
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
Secret
additional food aid. Pakistan has arranged 650,000 tons of wheat imports for
FY 1975. We expect aid and commercial purchases to total about 1.2 million
tons - short of government targets but adequate for FY 1975 needs.
The major rice harvest - two-thirds of annual grain production -- begins in
February and is dependent on rains from the northeast monsoon during
November-February. The government hopes for a repeat of last year's record harvest
of 75C,000 tons, which would permit 1975 grain imports to be reduced by 100,000
tons from the 850,000 tons of 1974. Colombo so far has arranged for 550,000
tons for 1975.
USSR: BLUE-CHIP FINANCIAL STATUS
The international financial position of the USSR has been strongly buttressed
by developments in the commodity and gold markets this year.
The turnaround in Soviet terms of trade, brought on by higher prices
for oil and other raw materials, will result in a sizable hard currency
trade surplus this year and almost certainly next.
Moscow continues to profit from higher gold prices; gold sales may earn
$850 million this year.
? Financial reserves, chiefly gold, continue to rise; by yearend they may
reach $12 billion.
Moscow now enjoys what is for it an unprecedented flexibility in trade matters,
much of which is attributable to its new policy toward gold. In the past, gold
was sold chiefly to offset payments deficit This year, however, Moscow has been
selling gold to take advantage of high prices. Moscow has sold increased quantities
during periods of rising prices and has backed out of the market when prices fell.
For example, during the first three months of 1974, when prices rose from $120
to more than $170 per troy ounce, the USSR sold about 60 tons of gold worth
nearly $300 million. Thereafter, as the price fell, Soviet sales also declined, averaging
about 6 tons per month through August. When prices began to rise sharply in
the last half of October, Moscow was back selling heavily.
13
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
Secret
Although the USSR continues to solicit and obtain subsidized credits from
Western governments, it now has the ability to pay cash to quickly wrap up priority
deals. The recent $100 million cash contract for 700 International 1-larvestor
tractors, needed for construction of the alternative trans-Siberian route, illustrates
this flexiblity. Also, Moscow can afford to buy large quantities of basic
commodities - which normally call for cash payment - even at record prices. Since
the beginning of October, the USSR lies contracted for $900 million in grain for
delivery through September i975. Moscow has
recently picked up $500 million to million worth of sugar on the world 25X1
market.
Encouraged by its new-found strength, the USSR has begun to assert itself'
in international financial markets.
? Moscow has been a highly visible participant in more than 30 Eurodollar
consortium loans this year, including the $1.5 billion loan to France in
which Vneshtorgbank itself participated.
? The USSR has applied for a $100 million untied Eurodollar loan for
itself, perhaps testing the water for future loans.
? Moscow has established two new banks in the West in 1974. It now
has seven banks and two branches actively operating in major Western
financial centers and continues to investigate the possibilities for
expanding its network.
The USSR has also become a more active participant in international forums.
For example, a Soviet expert recently addressed a commodity exchange group in
New York on the merits of trading in gold. Reflecting Moscow's apparent vested
interest in Western monetary stability, the Soviet press frequently offers unsolicited
advice on the role of gold in international monetary arrangements - preferably
Sugar Producers Hold Conclave
Latin American and Caribbean producers, the source of nearly one-half of
the sugar traded on the world market, are meeting in Mcxico. They are searching
14
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875R001500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
Secret
be on the agenda.
for production and marketing policies that will prevent sugar prices from falling
below profitable levels, presumably 20 cents a pound. Joint strategy for the
International Sugar Council meeting to be held in London next month also will
Canton Fair: US Purchases Up
In contrast to the decline in overall attendance and business at the 1974 Fall
Canton Fair, a record 300 US traders visited the fair anr' signed contracts worth
about $40 million. US purchases of $39 million were double the level of the 1974
spring fair and matched the total of last fall. While US sales declined to less than
$1 million from about $2 million at the spring fair, US firms held discussions
in Canton and later in Peking that could lead to Chinese purchases. Facing lower
previous fairs about the adverse effects of lack of MFN status
world demand for their traditional exports, the Chinese were more vocal than at
West European Nuclear Sales to Iran
The first nuclear powerplants to be built in the Middle East will be supplied
by West European firms. Iran has firmed up orders for two of the five power
reactors it had agreed to buy from Framatome (France) earlier this year and has
made arrangements to purchase two larger units from Kraftwerk Union (West
Germany). The four plants, valued at about $1.5 billion, are to be phased into
service beginning in 1980 and will give Iran 4,200 megawatts of nuclear capacity
by 1983, almost 1-1/2 times its present conventional capacity. The new capacity
will be used for desalinization, as well as for power generation. Westinghouse had
been believed to be the front runner in bidding for Iran's first nuclear powerplants.
(ER IR 74-29, November 1974,
This report discusses the record increase in Soviet trade with LDCs in 1973,
the role of military and economic aid deliveries in this trade, and changes in
commodity composition.
15
Secret
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
INDUSTRIAL PRODUCTION l
1070-100
---- --.....------
France
109
United Kingdom
100
Italy
103
Canada
110 /~
GNP'
Constant Market Prices
United States
Japan
West Germany
France
United Kingdom
Italy
Canada
Office of Economic Research/CIA
27 November 1974
Average Amoral Growth Rate Since
Percent Clmnge
Latest train Previous 1 Year Previous
Quarter Cleaner 1970 Earlier Quarter
RETAIL SALES'
Constant Prices
74 111 -0.5 3.2 -2.2 -2.1 United States
7411 0.6 5.7 -3.3 2.4 Japan
74 II - 0.7 3.1 1.1 - 2.9 West Germany
73 IV 1.7 5.8 6.0 7.0 France
74 111 1.0 2.7 0.6 4.2 United Kingdom
73 IV 1.9 3.7 5.3 7.7 Italy
7411 0 5.7 4.9 0 Canada
Average Annual Grewlh Role Since
Purcenl Chnngn
Latest from Previous 1 Your 1 Months
Mouth Moelh 1070 Earlier Earlier 2
Average An
nual Growth
note Since
Percent Change
Latest train Previous 1 Year 3 Months
Month Month 19711 Earlier Earlier 2
Oct 74
1
-1.3
1 2.3 I
-5.7
-4.7
Jun 74
1.7
1.8
-8.3
-5.8
Jul 74
5.7
2.8
0
-7.0
Jun 74
-6.7
-0.8
-1.0
-8.9
Jul 74
1.8
2.6
-0.9
-7.0
Apr 74
0.4
10.5
13.9
19.9
Jul 74
-0.6
1.7
-3.9
2.1
Note: US data provided by US government agencies
Footnotes appear on page A?4.
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
DOMESTIC PRICES'
1970-100
Whulen;alkn,.. I!.n
Average Annual Growth (late Since
Percent Charge
lotesl frum Previous I Year 3 Months
Month month 1970 Earlier Earlier
'I 'I 1
:18 2.
13.3
Semi-logarithmic Scale
75
Average Annual Growth Rate Since
Ave
rage Annual Growth Rate Since
Percent Change
latest from Previous 1 Yeur 3 Months
Percent Change
Latest from Previous
1 Year 3 Months
Month Month 1970 Earlier Earlier 2
Month Period
1970 Earlier Earlier 2
United State;:
Oct 74
0.4
5.8
5.7
2.2
United States
Sep 74
1.1
7.1
10.0
13.4
Japan
Jul 74
-0.2
17.5
13.8
20.2
Japan
Aug 74
-2.1
22.8
39.7
59.8
West Germany
Aug 74
1.0
9.2
9.6
13.8
West Germany
74 II
3.1
11.4
1?.7
13.1
France
Jun 74 ,
1.4
12.6
8.7
18.2
France
74111
6.0
13.8
20.5
26.4
United Kingdom
Oct 74
1.5
8.5
5.3
8.5
United Kingdom
Aug 74
6.4
14.1
15.6
31.4
Italy
Jan 74
1.1
20.6
20.7
17.1
Italy
Aug 74
3.0
17.9
20.7
25.7
Canada
Sep 74
-0.7
11.8
6.6
-6.1
Canada
Jun 74
1.4
9.0
12.8
17.3
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85TOO875RO01500150051-0
FOREIGN TRADE
1970-100 p o.b./Lo.h.l toles) Merrill
Million US
1074 1973 Change
8,280
j 71.575
150,428
I 41.9%
-233
-63
-2,284
5,276
29,109
131
1;1 A'Ir'
iTI
839
378
3,370
7,375
l;,'ll
d':III:I
r :'171
1,755
17,943
11,623
BASIC BALANCE5
Current and Long ?Te,m-Capital Transactions
.-.--Latest Peried.___. _._CunOdalive._(Millran_US $1_._._.
Million US S
1974 1973 Change
74 11
-2,740
954
-2,184
1.210
United States
Japan
Oct 74
405
-8,664
-6,978
-1.686
Japan
Sep 74
503
5,058
6,774
-1,716
West Germany
France
73 IV
?475
NA.
-2,472
NA,
France
7411
-1,297
-2,951
-868
-2,083
United Kingdom
Italy
Canada
74 1
- 2,037
-2,037
-872
-1.164
Italy
27 November 1974
-214
-1,023
-3,092
--11,1H .'7;;;1,
-474 -5,564
-1,843
1.582
-4,333
-5,613
-3,721
---
-
talest Month
End of
Billio
--
n US S
. Jun
1970
I Year
, Earlier
3 M
, Ea
onths
,:ier
1
4.5
12.9
1
4.9
Oct 74
1
3.5
4.1
14.0
1
3.2
Oct 74
3
3.7
8.8
35.0
3
3,9
Sep 74
8.5
4.4
11.2
8.2
Oct 74
7.5
2.8
6.8
6.7
Sep .4
7.6
4.7
6.5
5.3
Oct 74
5.8
4.3
5 q
Approved For Release 2009/09/29: CIA-RDP85TOO875RO01500150051-0
 Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0
United States
Japan
West Germany
France
United Kingdom
Canada
Eurodollars
EXPORT PRICES
National Currorcy
United States
Japan
West Germany
France
United Kingdom
Italy
Canada
EXPORT PRICES
us S
United States
Japan
West Germany
France
United Kingdom
Italy
Canada
Representative Holes
Doalur?plocod Iinanco paper
Call money
interbank loans (3 nronths)
Call ntonuy
Sterling interbank loansl3 months)
Finance paper
Three-month deposits
Nov 13
Nov I
Nov 13
Oct 11
Nov 13
Nov 13
Nov 13
Average Annual Growth Rate Since
Torrent change
Latest Irum Previous I Year 3 Months
Merrill Month 1910 Lathier Earlier
Sap 74 0.7 12.8 29.9 30.7
Oct 74 -0.1 10.7 36.8 14.9
Aug 74 2.0 5.0 22.6 24.8
Jun 74 3.3 11.1 28.5 42.5
Jul 74 1.6 13.6 33.2 29.6
Jul 74 3.9 15.4 42.8 43.4
Jul 74 1.7 12.4 38.3 13.5
Avcruge Annual Growth Hale Since
I'en:ent Chair()(?
Luusl Inns Previous 1 Year 3 Months
Month Month 1910 Earlier Earlier
Sep 74 0.7 12.6 I 29.9 30.7
Oct 74 -0.1 , 15.6 21.5 -4.1
Aug 74 -0.7 14.8 13.3 -3.0
Jun 74 2.5 14.7 11.5 33.5
Jul 74 1.5 13.5 25.1 29.5
Jul 74 4.8 14.6 28.6 35.7
Jul 74 0.7 14.3 41.5 j 9.4
United States
Japan
West Germany
France
United Kingdom
Italy
Canada
I
I 27 November 1974
Percent Change linen
Dec 66 18 Dec 71 19 Mar 73 15 Nov 74
-15.02 -5.70 0.91 -0.12
12.07 -1.45 -13.26 -0.04
33.95 16.77 11.68 0.16
-1806 -4.61 -7.07 -0.11
-37.52 ! -23.12 -8.61 0.07
-30.68
7.11
j
-29.24 -72.23 -0.84
0.51 2.17 I -0.06
9.00
12.50
9.04
13.13
11.91
10.48
9.90
I'urrenl Hale of Interest
IYnar 3Monlhs (Month
Luther Earlier Esther
8.25 I 11.85 I 9.56
8.75
13.85
11.13
12.80
9.10
9.58
13.50
9.46
14.00
12.60
11.63
13.51
IMPORT PRICES
National Currency
United States
Japan
West Germany
France
United Kingdom
Italy
Canada
12.50
0.00
13.75
11.83
11.03
11.04
EXCHANGE RATES
Spot Rate
As al 22 Nov 1974
Average Annual Growth Hate Since
I'ercmtt Change
Latest Irum Pnewuus I Year 3 Mantis
Month Mmdh 191U Earlier Earlier
Sep 74 -0.2 19.4 54.3 22.0
Sop 74 -0.5 16.8 75.6 4.3
Aug 74 3.1 7.5 35.3 23.0
Jun 74 0 15.6 1 61.5 37.0
Jul 74 0.5 21.3 55.9 18.3
Jul 74 -2.4 24.8 68.5 7.3
Jul 74 1.8 11.6 32.5 39.7
US S
I'er Unit ter 66 18 Dec 71 19 Mar 13 15 Nov 74
Japan (yen)
West Germany (Deutsche mark)
France (franc)
United Kingdom (pound starting)
Italy Ili(a)
0.0033
0.4032
0.2136
2.3200
00015
1.0118
20.84 2.68 -12.33
60.38 29.94 13.87
5.79 p.48 -3.09
-16.86 -10.96 -5.73
-6.50 -12.97 -15.42
9.69 1.40 . 1.41
0.03
0.42
0.09
0.30
-0.53
-0.01
FOOTNOTES FOR WEEKLY INDICATORS
I Seasonally adjusted.
2. Average Ior latest 3 months compared with average for previous 3 months.
3. Wholesale price indexes cover industrial goods.
4. Hourly earnings for the United Slates, Jopor. and Canada;
hourly wage rates lot others. West German and French data
ate for the beginning it[ the quarter.
5 Converted to US dollars at the current market rates of exchange
e Weighting is haled on each listed country's trade with 16 other indusuialieed countries
to reflect the competitive impact at exchange rate variations among the major currencies.
Approved For Release 2009/09/29: CIA-RDP85T00875RO01500150051-0