What does m2 mean in banking?

M2 includes a broader set of financial assets held principally by households. M2 consists of M1 plus: (1) savings deposits (which include money market deposit accounts, or MMDAs); (2) small-denomination time deposits (time deposits in amounts of less than $100,000); and (3) balances in retail money market mutual funds (MMMFs).

What is m2 IRA & Keogh?

Beginning May 2020, M2 consists of M1 plus (1) small-denomination time deposits (time deposits in amounts of less than $100,000) less IRA and Keogh balances at depository institutions; and (2) balances in retail MMFs less IRA and Keogh balances at MMFs.

What is m1 & m2?

The broader M2 component includes M1 in addition to saving deposits, certificates of deposit (less than $100,000), and money market deposits for individuals. Comparing the velocities of M1 and M2 provides some insight into how quickly the economy is spending and how quickly it is saving.

What does m2 mean in 2023?

In a May 2023 Economic Synopses essay, Senior Economic Policy Advisor Christopher Neely discussed the unusual behavior of the year-over-year growth rate of M2 starting in February 2020. M2 is a broad measure of the money supply, which Neely explained includes currency and various relatively liquid bank and money market mutual fund deposits.