Saturday, 5 January 2013

Movements in the U.S. Monetary Base and Money Supply (as of 26 Dec-2012)

Money supply, especially M2 and MZM, continues to grow significantly according to data released by FRED on 4 January 2013 for the period ending 26 December 2012. As a result of this and the increase in the M1 Money Multiplier seen during most of 2012, the Fed appears to attempt to offset this growth somewhat as the Monetary Base has been shrinking 4.30% since 22 February 2012. The base however remains a tremendous USD 1,785.1 billion (210.5%) higher than the USD 848.0 billion base on 2 January 2008 providing banks with plenty of ammunition to expand money supply rapidly going forward as well.

Monetary Base
The Monetary Base decreased 1.29% for the bi-weekly period to end on USD 2,633.1 billion, 4.30% lower than the highest base ever reported (22 Feb 2012). The base was up by 2.90% compared to the same period last year.

M1 Money Stock/Supply
The M1 Money Stock was down 1.02% for the bi-weekly period and ended the week on USD 2,447.1 billion. Compared to the same period last year, M1 increased 13.51%.

M2 Money Stock/Supply
M2 Money Stock was up 0.82% for the bi-weekly period and ended the week on USD 10,412.3 billion. Compared to the same period last year, M2 was up by 8.38%. The M2 money stock for the week was the highest ever reported.














Notes:
The Federal Reserve Bank of St. Louis reported the Monetary Base and Money Stock (Supply) figures for the bi-weekly period ending 26 December on 4 January 2013. The data series used in this report start in January 2008 and are the bi-weekly, average figures ending Wednesday.