Money Supply Shrinks for the First Time


Ultimately, as M2 retreats further it should continue to help cool inflation as the dip in money reserves crimps demand and lowers “capacity to support bank loans and other financing for households, firms, and financial market transactions,” said Nathan Sheets, Citi’s global chief economist.

But investors shouldn’t assume that declining M2 will automatically signal an economic slowdown, writes Merion Capital Group’s Richard Farr. M2 “needs to fall by at least another trillion dollars,” to even matter, he said.

MarketWatch Barrons 24 January 2023

Central Bankers Should Prioritize Growth Over Their Pride

Policymakers risk overtightening in an effort to restore their inflation-battered credibility.

Marcus Ashworth Bloomberg 24 januari 2023


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