Narrow money (M1) represents the most liquid forms of money available for immediate use in transactions within the economy.
It includes currency in circulation, such as banknotes and coins, as well as sight deposits (e.g. overnight deposits) held by domestic non-banks, which can be readily converted into cash or used for cashless payments. Monetary aggregates are compiled by central banks based on surveys of monetary and financial institutions. These aggregates — including narrow money (M1), intermediate money (M2), and broad money (M3) — capture different aspects of money’s function in the economy, from means of exchange to store of value. Narrow money (M1) is particularly relevant for measuring money used in daily economic transactions.
The indicator is presented as a seasonally adjusted index, with 2015 as the reference year.
