1 M2, M0 and M1 are all indicators of the velocity of money circulation, but they have different definitions and application scopes. 2 M2 is the broad money supply, including M1 and other liquid assets, such as time deposits, money market funds, etc., reflecting the liquidity situation of the entire money market.
3 M0 is the narrow money supply, also known as the base money supply, which refers to the cash in the banking system and the deposit reserves of commercial banks in the central bank, reflecting the central bank's ability to control the money market.
4 M1 is the intermediate money supply, which includes M0 and negotiable demand deposits, reflecting the money used by individuals and businesses in their daily lives.
5 Generally speaking, the difference between M2, M0 and M1 lies in the types of currencies and the scope of application, which need to be selected and used according to the actual situation.
1 M0 refers to the most liquid form of money, including cash, deposit reserves, etc., which can be used directly for transactions and payments.
2 M1 refers to the next most liquid form of money, including M0 and demand deposits, which can be used for payments and transfers.
3 M2 is a form of money with low liquidity. In addition to the monetary form of M1, it also includes time deposits and savings deposits, etc. These forms of money have relatively poor liquidity and cannot be directly used for transactions and payments, but can be used for investment and savings.
m2, m1, and m0 refer to different standards of money supply.
m2 usually includes all money in circulation (M1), time deposits, savings deposits and other time deposits, and is an important indicator to measure the total amount of social credit. m1, also known as broad money supply, refers to cash in circulation plus savings deposits that can be used to pay for consumption at any time, including cash deposits, checking deposits, third-party payment accounts, etc.
m0 is the narrow money supply, which only includes cash in circulation and bank reserves. It is the top level basis of the entire money supply system and the most basic indicator to measure the domestic money supply.
In general, the differences of m2, m1 and m0 reflect the situation of money supply in different ranges, which can understand the economic situation from multiple angles and provide a reference for monetary policy making.
1. m2, m1 and m0 are three indicators of money supply, which are used to measure the circulation of national currency. m2 refers to broad money, including cash in circulation, time deposits, monetary funds, government bonds, corporate bonds, etc. m2 is the broadest indicator of money supply.
m1 refers to narrow money, including cash in circulation, demand deposits, bank liquidation reserves, etc., which is a relatively narrow index of money supply.
m0 refers to base money, that is, money issued by central banks, such as coins in circulation, notes, and reserves of commercial banks.
3. The difference between the three indicators lies in the variety and range of currencies included. m2 is the broadest, m0 is the narrowest, and m1 is in the middle.
The choice of different indicators also depends on the object and purpose of the study.
m0, m1 and m2 are all monetary rights and interests, but they are different in terms of money supply, scope of application, and object of issue. M0 refers to cash in circulation, that is, money in the true sense of the market. M1 adds demand deposits that can be converted into cash on the basis of M0, that is to say, M1 contains a part of M0.
On the basis of M1, M2 adds time deposits, savings deposits, money market funds, etc., but does not include deposits between the People's Bank, government departments and financial institutions.
In general, the larger the money supply, the more money circulating in the market, the greater the inflationary pressure and the higher the interest rate.
Therefore, macroeconomic policy makers need to adjust the money supply according to changes in the current situation to maintain economic stability and balance.