Components Of Money Supply

Components of Money Supply:


M0: The total of all physical currency, plus accounts at the central bank that can be exchanged for physical currency.


M1: M0 - those portions of M0 held as reserves or vault cash + the amount in demand accounts ("checking" or "current" accounts).


M2: M1 + most savings accounts, money market accounts, and small denomination time deposits (certificates of deposit of under $100,000).


M3: M2 + all other CDs (large time deposits, institutional money market mutual fund balances), deposits of eurodollars and repurchase agreements.


*The Federal Reserve ceased publishing M3 statistics in March 2006, explaining that M3 did not appear to convey additional information about economic activity compared to M2, had not been used in determining economic policy, and that the costs to collect M3 data outweighed the benefits. Some of the data used to calculate M3 are still collected and published on a regular basis.



Data Courtesy: Wikipedia