M2 means cash outside the banking system plus corporate deposits, residential savings deposits, and other deposits. It includes all the currency forms that may become real purchasing power, which usually reflects the stress state of social overall demand and future inflation. Essence Currency (m0) = cash in circulation, that is, cash circulating outside the banking system. The narrow currency (m1) = (m0) daily deposit. D broad currency (M2) = m1 quasi -currency (regular deposit resident savings deposit other deposits securities company customer margin housing provident fund center deposit non -deposit financial institution in deposit financial institutions). M3 = m2 other short -term current assets (such as Treasury vouchers, bank acceptance bills, commercial bills, etc.). The currency mentioned in economics usually refers to M2, and M2 includes quasi -currency. m2 is an indicator reflecting the amount of currency supply in the broad currency. In addition, M0, M1 and M3. M2 reflects the real purchase ability in the economy. If M2 grows faster, it means that investment and market are more active. These indicators in general currencies do not exist alone. The indicators have an influence on each other. It is necessary to analyze the current economic conditions in conjunction with multiple indicators.
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