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Money supply, also known as money stock, refers to the total amount of money circulating in a country’s economy during a given period.

2026-08-07·x-repost-20260807-082627

Money supply, also known as money stock, refers to the total amount of money circulating in a country’s economy during a given period. The money circulating in the market generally includes cash, coins, bank account balances, and certain tangible or intangible assets that are also liquid and tradable, such as retail money market mutual fund shares.

Money supply measures are classified into different categories—M0, M1, M2, and M3—with each successive measure including additional types of money. Different governments and financial institutions use different money supply measures to analyze and forecast economic conditions.

Government and central bank policies can be used to control the amount of money issued in a country. In the past, changes in the money supply closely affected a country’s overall economic environment, including the rate of inflation and the pace of economic growth.

However, as financial products and asset types have become increasingly complex, the relationship between the money supply and inflation has become less stable than it was in the past.

The money supply includes various tangible and intangible assets, such as coins and paper currency held by the public, savings account balances at depository institutions, transaction deposit balances at financial institutions, and retail money market mutual fund shares.

However, the money supply does not include long-term investments, home equity, loan amounts, mortgage amounts, credit card limits, or physical assets that must be sold to be converted into cash. U.S. money supply measures are categorized based on their contents as the monetary base, M1, M2, and M3. However, the M3 measure has not been used since 2006.

Data for all measures are released weekly or monthly on the Federal Reserve’s money supply website. As in other countries, the U.S. money supply directly affects the country’s economic development, including inflation, the pace of economic growth, and consumers’ purchasing power. At the same time, the U.S.

government and the Federal Reserve adjust the money supply in response to changes in the U.S. economic environment. Federal Reserve policy is the most important determinant of the U.S. money supply.

For example, when the Federal Reserve uses contractionary monetary policy to restrict the money supply, borrowing costs increase accordingly, helping to curb inflation. However, this may also slow economic growth. ## Types of U.S. Money Supply The U.S.

money supply is primarily divided into three categories: the monetary base, M1, and M2, as well as M3, which has not been reported since 2006. M1 primarily includes the total amount of currency held by the public and the total amount of transaction deposits at depository institutions, making it one of the most commonly used money supply measures.

In addition to all the money included in M1, M2 also includes savings account deposits, money market funds, and time deposit balances of less than $100,000. M3 is the broadest money supply measure and covers nearly all tangible and intangible forms of money supply.

The Federal Reserve releases different money supply measures weekly and monthly on its money supply website. However, the Federal Reserve has not published M3 data since 2006. ## Methods for Measuring the U.S. Money Supply ### Monetary Base The monetary base includes currency in circulation, including coins and paper currency, as well as reserve balances.

These reserve balances include deposits held by commercial banks and the total reserves that commercial banks hold at the central bank.

### M1 M1 includes all the money contained in the monetary base, as well as: Traveler’s checks; demand deposits, primarily including demand deposits from commercial banks, savings and loan associations, savings banks, credit unions, and other institutions.

## M2 Includes all the money in M1, as well as: - Savings deposits - Time deposits of less than $100,000 - Money market funds ## M3 (No longer reported after 2006) Includes all the money in M2, as well as: - Time deposits of more than $100,000 - Institutional money market funds - Term repurchase agreements ## How Can the U.S.

Money Supply Be Used to Analyze the U.S. Economy? At times, money supply indicators are closely connected with factors including gross domestic product (GDP), price levels, and inflation.

Trends in money supply indicators can provide important information about the direction of the economy and may also allow for certain predictions about its future development. Under normal circumstances, an increase in the money supply generally leads to lower interest rates.

Consumers can then borrow money at lower rates to finance spending, while businesses have more funds available to increase production capacity. Overall, this can stimulate consumption, accelerate economic growth, and increase employment.

Conversely, if the money supply declines or its growth rate slows, the opposite may occur: interest rates may rise, consumers’ purchasing power may decrease, and businesses may face funding shortages. As market demand falls, businesses may be forced to reduce production to limit costs and losses, slowing overall economic growth and increasing unemployment.

However, over the past decade, the relationship between money supply indicators and economic growth, GDP trends, and inflation has become less stable than it was in the past.

As a result, changes in the money supply no longer provide the same level of analytical accuracy, nor can adjustments to the money supply necessarily achieve the intended economic-policy objectives.

Former Federal Reserve Chair Alan Greenspan even argued that continuing to rely on the M2 money supply indicator to guide monetary policy could lead to a recession*. Therefore, although the money supply remains a widely used indicator, its role in final decision-making is now comparable to that of many other major economic data points.

## What Is the Relationship Between the U.S. Money Supply and U.S. Inflation? The following chart shows the annual average M0 values from 1959 to 2021, along with the corresponding CPI values. [amcharts id=”money-supply”] The data from the chart are listed below. We also include the annual change in M0 and the corresponding annual CPI change rate.

| Year | M0 (Millions) | M0 Change Rate | CPI | CPI Change Rate | |---|---:|---:|---:|---:| | 1959 | 50,483 | | 29.2 | | | 1960 | 50,008 | -0.94% | 29.6 | 1.37% | | 1961 | 49,308 | -1.40% | 29.9 | 1.01% | | 1962 | 50,933 | 3.30% | 30.3 | 1.34% | | 1963 | 52,442 | 2.96% | 30.6 | 0.99% | | 1964 | 55,183 | 5.23% | 31.0 | 1.31% | | 1965 | 58,108 | 5.30% | 31.5

| 1.61% | | 1966 | 61,533 | | | | | Year | Value 1 | Change 1 | Value 2 | Change 2 | |---|---:|---:|---:|---:| | 1967 | 64,658 | 5.08% | 33.4 | 2.77% | | 1968 | 69,383 | 7.31% | 34.8 | 4.19% | | 1969 | 73,675 | 6.19% | 36.7 | 5.46% | | 1970 | 77,567 | 5.28% | 38.8 | 5.72% | | 1971 | 83,267 | 7.35% | 40.5 | 4.38% | | 1972 | 89,083 | 6.99% | 41.8 | 3.21% | |

1973 | 94,667 | 6.27% | 44.4 | 6.22% | | 1974 | 103,650 | 9.49% | 49.3 | 11.04% | | 1975 | 108,567 | 4.74% | 53.8 | 9.13% | | 1976 | 114,733 | 5.68% | 56.9 | 5.76% | | 1977 | 122,958 | 7.17% | 60.6 | 6.50% | | 1978 | 134,600 | 9.47% | 65.2 | 7.59% | | 1979 | 147,608 | 9.66% | 72.6 | 11.35% | | 1980 | 158,633 | 7.47% | 82.4 | 13.50% | | 1981 | 164,092 |

3.44% | 90.9 | 10.32% | | 1982 | 172,325 | 5.02% | 96.5 | 6.16% | | 1983 | 183,433 | 6.45% | 99.6 | — | | 1984 | 195,292 | 6.46% | 103.9 | 4.32% | | 1985 | 210,708 | 7.89% | 107.6 | 3.56% | | 1986 | 230,950 | 9.61% | 109.6 | 1.86% | | 1987 | 253,375 | 9.71% | 113.6 | 3.65% | | 1988 | 272,075 | 7.38% | 118.3 | 4.14% | | 1989 | 283,508 | 4.20% | 124.0 | 4.82%

| | 1990 | 302,033 | 6.53% | 130.7 | 5.40% | | 1991 | 318,575 | 5.48% | 136.2 | 4.21% | | 1992 | 341,850 | — | 140.3 | 3.01% | | 1993 | 376,808 | 10.23% | 144.5 | 2.99% | | 1994 | 411,633 | 9.24% | 148.2 | 2.56% | | 1995 | 434,025 | 5.44% | 152.4 | 2.83% | | 1996 | 448,158 | 3.26% | 156.9 | 2.95% | | 1997 | 472,100 | 5.34% | 160.5 | 2.29% | | 1998 | 502,600

| — | 163.0 | 1.56% | | 1999 | 551,842 | 9.80% | 166.6 | 2.21% | | 2000 | 585,292 | 6.06% | 172.2 | 3.36% | | 2001 | 618,458 | 5.67% | 177.1 | 2.85% | | 2002 | 673,542 | 8.91% | 179.9 | 1.58% | | 2003 | 716,525 | 6.38% | 184.0 | 2.28% | | 2004 | 752,733 | 5.05% | 188.9 | 2.66% | | 2005 | 782,625 | 3.97% | 195.3 | 3.39% | | 2006 | 811,525 | 3.69% | 201.6 | 3.23% | | 2007 | 827,183 | 1.93% | — | — | Unassigned leading values: 5.89%, 32.5, and 3.17%.

| Year | M0 Money Supply | YoY Change | CPI | YoY Change | |---|---:|---:|---:|---:| | 2008 | 987,300 | 19.36% | 215.3 | 3.86% | | 2009 | 1,775,475 | 79.83% | 214.5 | -0.37% | | 2010 | 2,009,992 | 13.21% | 218.1 | 1.68% | | 2011 | 2,517,508 | 25.25% | 224.9 | 3.12% | | 2012 | 2,641,117 | 4.91% | 229.6 | 2.09% | | 2013 | 3,251,700 | 23.12% | 233.0 | 1.48% |

| 2014 | 3,926,533 | 20.75% | 236.7 | 1.59% | | 2015 | 3,974,442 | 1.22% | 237.0 | 0.13% | | 2016 | 3,763,092 | -5.32% | 240.0 | 1.27% | | 2017 | 3,810,467 | 1.26% | 245.1 | 2.13% | | 2018 | 3,641,117 | -4.44% | 251.1 | 2.45% | | 2019 | 3,301,433 | -9.33% | 255.7 | 1.83% | | 2020 | 4,615,075 | 39.79% | 258.8 | 1.21% | | 2021 | 6,052,600 | 31.15% | 271.0 | 4.71% | | 2022 (through March) | 6,092,800 | 0.66% | 284.6 | — | M0 money supply growth-rate data source: St.

Louis Fed. CPI data source: Federal Reserve Bank of Minneapolis. 2022 CPI data source: Trading Economics.

Full text

Money supply, also known as money stock, refers to the total amount of money circulating in a country’s economy during a given period.

Money supply, also known as money stock, refers to the total amount of money circulating in a country’s economy during a given period. The money circulating in the market generally includes cash, coins, bank account balances, and certain tangible or intangible assets that are also liquid and tradable, such as retail money market mutual fund shares. Money supply measures are classified into different categories—M0, M1, M2, and M3—with each successive measure including additional types of money. Different governments and financial institutions use different money supply measures to analyze and forecast economic conditions. Government and central bank policies can be used to control the amount of money issued in a country. In the past, changes in the money supply closely affected a country’s overall economic environment, including the rate of inflation and the pace of economic growth. However, as financial products and asset types have become increasingly complex, the relationship between the money supply and inflation has become less stable than it was in the past. The money supply includes various tangible and intangible assets, such as coins and paper currency held by the public, savings account balances at depository institutions, transaction deposit balances at financial institutions, and retail money market mutual fund shares. However, the money supply does not include long-term investments, home equity, loan amounts, mortgage amounts, credit card limits, or physical assets that must be sold to be converted into cash. U.S. money supply measures are categorized based on their contents as the monetary base, M1, M2, and M3. However, the M3 measure has not been used since 2006. Data for all measures are released weekly or monthly on the Federal Reserve’s money supply website. As in other countries, the U.S. money supply directly affects the country’s economic development, including inflation, the pace of economic growth, and consumers’ purchasing power. At the same time, the U.S. government and the Federal Reserve adjust the money supply in response to changes in the U.S. economic environment. Federal Reserve policy is the most important determinant of the U.S. money supply. For example, when the Federal Reserve uses contractionary monetary policy to restrict the money supply, borrowing costs increase accordingly, helping to curb inflation. However, this may also slow economic growth. ## Types of U.S. Money Supply The U.S. money supply is primarily divided into three categories: the monetary base, M1, and M2, as well as M3, which has not been reported since 2006. M1 primarily includes the total amount of currency held by the public and the total amount of transaction deposits at depository institutions, making it one of the most commonly used money supply measures. In addition to all the money included in M1, M2 also includes savings account deposits, money market funds, and time deposit balances of less than $100,000. M3 is the broadest money supply measure and covers nearly all tangible and intangible forms of money supply. The Federal Reserve releases different money supply measures weekly and monthly on its money supply website. However, the Federal Reserve has not published M3 data since 2006. ## Methods for Measuring the U.S. Money Supply ### Monetary Base The monetary base includes currency in circulation, including coins and paper currency, as well as reserve balances. These reserve balances include deposits held by commercial banks and the total reserves that commercial banks hold at the central bank. ### M1 M1 includes all the money contained in the monetary base, as well as: Traveler’s checks; demand deposits, primarily including demand deposits from commercial banks, savings and loan associations, savings banks, credit unions, and other institutions. ## M2 Includes all the money in M1, as well as: - Savings deposits - Time deposits of less than $100,000 - Money market funds ## M3 (No longer reported after 2006) Includes all the money in M2, as well as: - Time deposits of more than $100,000 - Institutional money market funds - Term repurchase agreements ## How Can the U.S. Money Supply Be Used to Analyze the U.S. Economy? At times, money supply indicators are closely connected with factors including gross domestic product (GDP), price levels, and inflation. Trends in money supply indicators can provide important information about the direction of the economy and may also allow for certain predictions about its future development. Under normal circumstances, an increase in the money supply generally leads to lower interest rates. Consumers can then borrow money at lower rates to finance spending, while businesses have more funds available to increase production capacity. Overall, this can stimulate consumption, accelerate economic growth, and increase employment. Conversely, if the money supply declines or its growth rate slows, the opposite may occur: interest rates may rise, consumers’ purchasing power may decrease, and businesses may face funding shortages. As market demand falls, businesses may be forced to reduce production to limit costs and losses, slowing overall economic growth and increasing unemployment. However, over the past decade, the relationship between money supply indicators and economic growth, GDP trends, and inflation has become less stable than it was in the past. As a result, changes in the money supply no longer provide the same level of analytical accuracy, nor can adjustments to the money supply necessarily achieve the intended economic-policy objectives. Former Federal Reserve Chair Alan Greenspan even argued that continuing to rely on the M2 money supply indicator to guide monetary policy could lead to a recession*. Therefore, although the money supply remains a widely used indicator, its role in final decision-making is now comparable to that of many other major economic data points. ## What Is the Relationship Between the U.S. Money Supply and U.S. Inflation? The following chart shows the annual average M0 values from 1959 to 2021, along with the corresponding CPI values. [amcharts id=”money-supply”] The data from the chart are listed below. We also include the annual change in M0 and the corresponding annual CPI change rate. | Year | M0 (Millions) | M0 Change Rate | CPI | CPI Change Rate | |---|---:|---:|---:|---:| | 1959 | 50,483 | | 29.2 | | | 1960 | 50,008 | -0.94% | 29.6 | 1.37% | | 1961 | 49,308 | -1.40% | 29.9 | 1.01% | | 1962 | 50,933 | 3.30% | 30.3 | 1.34% | | 1963 | 52,442 | 2.96% | 30.6 | 0.99% | | 1964 | 55,183 | 5.23% | 31.0 | 1.31% | | 1965 | 58,108 | 5.30% | 31.5 | 1.61% | | 1966 | 61,533 | | | | | Year | Value 1 | Change 1 | Value 2 | Change 2 | |---|---:|---:|---:|---:| | 1967 | 64,658 | 5.08% | 33.4 | 2.77% | | 1968 | 69,383 | 7.31% | 34.8 | 4.19% | | 1969 | 73,675 | 6.19% | 36.7 | 5.46% | | 1970 | 77,567 | 5.28% | 38.8 | 5.72% | | 1971 | 83,267 | 7.35% | 40.5 | 4.38% | | 1972 | 89,083 | 6.99% | 41.8 | 3.21% | | 1973 | 94,667 | 6.27% | 44.4 | 6.22% | | 1974 | 103,650 | 9.49% | 49.3 | 11.04% | | 1975 | 108,567 | 4.74% | 53.8 | 9.13% | | 1976 | 114,733 | 5.68% | 56.9 | 5.76% | | 1977 | 122,958 | 7.17% | 60.6 | 6.50% | | 1978 | 134,600 | 9.47% | 65.2 | 7.59% | | 1979 | 147,608 | 9.66% | 72.6 | 11.35% | | 1980 | 158,633 | 7.47% | 82.4 | 13.50% | | 1981 | 164,092 | 3.44% | 90.9 | 10.32% | | 1982 | 172,325 | 5.02% | 96.5 | 6.16% | | 1983 | 183,433 | 6.45% | 99.6 | — | | 1984 | 195,292 | 6.46% | 103.9 | 4.32% | | 1985 | 210,708 | 7.89% | 107.6 | 3.56% | | 1986 | 230,950 | 9.61% | 109.6 | 1.86% | | 1987 | 253,375 | 9.71% | 113.6 | 3.65% | | 1988 | 272,075 | 7.38% | 118.3 | 4.14% | | 1989 | 283,508 | 4.20% | 124.0 | 4.82% | | 1990 | 302,033 | 6.53% | 130.7 | 5.40% | | 1991 | 318,575 | 5.48% | 136.2 | 4.21% | | 1992 | 341,850 | — | 140.3 | 3.01% | | 1993 | 376,808 | 10.23% | 144.5 | 2.99% | | 1994 | 411,633 | 9.24% | 148.2 | 2.56% | | 1995 | 434,025 | 5.44% | 152.4 | 2.83% | | 1996 | 448,158 | 3.26% | 156.9 | 2.95% | | 1997 | 472,100 | 5.34% | 160.5 | 2.29% | | 1998 | 502,600 | — | 163.0 | 1.56% | | 1999 | 551,842 | 9.80% | 166.6 | 2.21% | | 2000 | 585,292 | 6.06% | 172.2 | 3.36% | | 2001 | 618,458 | 5.67% | 177.1 | 2.85% | | 2002 | 673,542 | 8.91% | 179.9 | 1.58% | | 2003 | 716,525 | 6.38% | 184.0 | 2.28% | | 2004 | 752,733 | 5.05% | 188.9 | 2.66% | | 2005 | 782,625 | 3.97% | 195.3 | 3.39% | | 2006 | 811,525 | 3.69% | 201.6 | 3.23% | | 2007 | 827,183 | 1.93% | — | — | Unassigned leading values: 5.89%, 32.5, and 3.17%. | Year | M0 Money Supply | YoY Change | CPI | YoY Change | |---|---:|---:|---:|---:| | 2008 | 987,300 | 19.36% | 215.3 | 3.86% | | 2009 | 1,775,475 | 79.83% | 214.5 | -0.37% | | 2010 | 2,009,992 | 13.21% | 218.1 | 1.68% | | 2011 | 2,517,508 | 25.25% | 224.9 | 3.12% | | 2012 | 2,641,117 | 4.91% | 229.6 | 2.09% | | 2013 | 3,251,700 | 23.12% | 233.0 | 1.48% | | 2014 | 3,926,533 | 20.75% | 236.7 | 1.59% | | 2015 | 3,974,442 | 1.22% | 237.0 | 0.13% | | 2016 | 3,763,092 | -5.32% | 240.0 | 1.27% | | 2017 | 3,810,467 | 1.26% | 245.1 | 2.13% | | 2018 | 3,641,117 | -4.44% | 251.1 | 2.45% | | 2019 | 3,301,433 | -9.33% | 255.7 | 1.83% | | 2020 | 4,615,075 | 39.79% | 258.8 | 1.21% | | 2021 | 6,052,600 | 31.15% | 271.0 | 4.71% | | 2022 (through March) | 6,092,800 | 0.66% | 284.6 | — | M0 money supply growth-rate data source: St. Louis Fed. CPI data source: Federal Reserve Bank of Minneapolis. 2022 CPI data source: Trading Economics.

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