The M2 money supply — includes all currency in circulation, checking deposits, savings accounts, and money market funds. The broadest standard measure of money in the economy.
M2 growth fueled the 2020-2022 inflation surge. When M2 contracts year-over-year — which happened for the first time in 90 years in 2023 — it signals a powerful deflationary force.
Rapid M2 growth = inflationary pressure building. M2 contraction = deflationary headwind. Regime Intelligence uses M2 as a liquidity and inflation regime input.