monetary base

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Monetary base

Sum of the currency held by the public and reserves held by financial institutions with the Federal Reserve Banks. This is the monetary aggregate that the Federal Reserve has control over through its monetary policy. Also called High Powered Money because the effect of changes in monetary base on money supply is magnified by the money multiplier.

Narrow Money

A measure of the money supply used by the various central banks that includes only currency in circulation and very near money instruments. In the Federal Reserve System, narrow money includes all physical currency and deposits in checking accounts as well as Negotiable Orders Withdrawal accounts. It does not include savings accounts, certificates of deposit, or money market accounts. This is called narrow money because it applies the most restrictive definition of money. It is also called the money base. See also: M1, M0.

monetary base


high-powered money

that part of the MONEY SUPPLY that is directly

under the control of a country's CENTRAL BANK. In the UK this consists of CURRENCY (BANK NOTES and COINS) in circulation plus commercial banks’ TILL MONEY and their operational balances at the BANK OF ENGLAND - equal to the ‘M0‘ definition of money. See MONEY SUPPLY DEFINITIONS, MONETARY POLICY.

References in periodicals archive ?
The UAE monetary base shrunk five per cent in January to Dh278.
TOKYO, March 3 (KUNA) -- Japan's monetary base surged 36.
Meanwhile since the beginning of the year the monetary base expanded by 31.
Economists refer to interventions that alter a nation's monetary base as nonsterilized.
The country's monetary base at the end of September stood at 185.
We do so by looking at monetary policy innovations to the monetary base in an estimated vector autoregression (VAR) to see how monetary policy shocks impact the entire term structure of U.
Between 2003 and 2009, the PBoC neutralized nearly 40 percent of the impact of these reserve inflows on the monetary base by selling so-called "sterilization bonds" to banks.
monetary base (the sum of currency in circulation and bank deposits at the Federal Reserve Banks) more than doubled in size in the last several months because of the Fed's unconventional responses to the financial crisis, including the purchase of private debt and billions of dollars in short-term loans.
Beginning about September, the usually stable graph of monetary base vs.
The result was a doubling of the size of the monetary base in the final four months of 2008.
The Bank of Japan reduced interest rates to zero by increasing the monetary base, the aggregate of bank notes outstanding and current account deposits by banks.
While the divergence between the monetary base and the money stock continued to expand, the Bank of Japan's reluctant purchases of Japanese government bonds, "unconventional" assets like asset-backed securities and equities from the banks helped to change the composition of the monetary base.