Summary: The growth of deposits in US banks continues to accelerate. The numbers imply healthy broad money growth, eventually translating into activity.

What does the chart show: The chart shows the thirteen-week (ie, three-month) annualised rate of change of deposits in US commercial banks. The red line is total deposits, the blue is large time deposits (ie, deposits in excess of $100,000) and the green line is other deposits. The thirteen-week annualised rate catches the most recent trends, but can be volatile.

Why is the chart interesting: Broad money is a leading indicator of economic activity. Broad money consists of the bank deposits of the private non-bank sector (ie, households and non-bank companies) and of cash. But of these two, cash is just short of 1.1 trillion dollars, while deposits total some 12.3 trillion dollars and are therefore vastly more important. Since early December, deposits have grown by double-digit rates. This is a clear indication of continued healthy, if not spectacular, US activity in 2013. The threat of the fiscal cliff is very much a myth.

Chart and comments provided by Stein Brothers (UK), www.steinbrothers.co.uk