M2 Money Supply
Broad money supply (seasonally adjusted), billions of dollars, monthly
M2 is a broad measure of money in the system (cash, checking deposits, and savings-like balances). It’s not a trading catalyst every day, but it’s a powerful regime variable: sustained money growth often aligns with easier liquidity and stronger risk asset multiples, while sustained contraction tends to coincide with tighter credit conditions and weaker growth outcomes.
Historical M2 Chart
Related Indicators
How to interpret M2
What M2 includes
M2 includes cash, checking deposits, and “near money” (savings deposits, retail money market funds, small time deposits). It’s a proxy for broad liquidity, though it doesn’t map one-to-one with spending or inflation in the short run.
Why growth rate matters
The level trends over time, so the market often cares more about the rate of change. Rapid expansion can coincide with asset price inflation and easier credit; contraction can coincide with tighter lending and slower nominal growth.
Policy regimes
M2 is influenced by the interaction of Fed policy, bank balance sheets, and private credit creation. In tightening cycles, money growth often slows as lending standards tighten and real rates rise.
How traders use it
Treat M2 as a macro “liquidity backdrop.” It can help explain why risk assets behave differently across cycles even when earnings look similar. Pair it with financial conditions, credit spreads, and the yield curve.
Current Reading
Interpreting the Signal
Best cross-checks
Compare M2 with the Fed Funds rate and NFCI. If policy is tight and conditions are restrictive, money growth tends to slow — and risk assets can have less liquidity support.
Release Notes
Updated monthly. Moves are slow, but regime shifts (fast expansion or contraction) can be macro-significant.
- Frequency: Monthly
- Unit: Billions of dollars
- Seasonally adjusted