Money & CreditWeekly · Federal Reserve H.6

M2 Money Supply Tracker: Today's Reading, YoY Growth & S&P 500 Overlay

Q: What is M2 money supply?

M2 is a Federal Reserve aggregate that measures the broad US money supply: currency in circulation + checking deposits + savings deposits + small time deposits (CDs under $100,000) + retail money market funds. It's the most-watched US monetary aggregate and is published weekly by the Federal Reserve.

Q: Is M2 growing or shrinking right now?

Check the YoY % chart on this page for the current reading. The long-term average M2 YoY growth is approximately +6%. Above +10% indicates a hot monetary environment; below 0% (negative YoY) is structurally rare. M2 contracted YoY in 2022–2023 for the first time since the 1930s Depression, then resumed growth in 2024.

Q: Does M2 affect stock prices?

Yes — M2 growth tends to lead financial-asset moves by 6–18 months. The 2020–2021 M2 surge (over 25% YoY at peak) preceded the 2021 asset bubble in equities, housing, and crypto. The 2022 M2 contraction preceded the 2022 equity drawdown. The relationship is one of the cleanest macro / equity linkages, though the timing is variable.

Q: What does M2 contraction mean?

A year-over-year decline in M2 means the total amount of broadly-defined money in the US economy is shrinking. This is structurally rare — before 2022, the last negative YoY M2 reading was during the 1930s. It typically indicates very tight monetary conditions: the Fed is removing reserves faster than private credit creation can replace them. Historically associated with disinflation/deflation, lower asset prices, and slower economic growth.

Q: What is the relationship between M2 and inflation?

Milton Friedman's monetarist framework holds that "inflation is always and everywhere a monetary phenomenon." Empirically, persistent M2 growth above ~8% YoY has historically been followed by elevated CPI prints 12–24 months later. The 2020–2021 M2 surge → 2022 inflation peak was a textbook example. Velocity matters too — even large M2 expansion may not be inflationary if money sits idle (low velocity).

Q: What was the largest M2 expansion in history?

M2 grew over 25% year-over-year in 2020–2021, the fastest pace since World War II. The Fed's pandemic-era quantitative easing and fiscal stimulus combined to push M2 from approximately $15.5 trillion in early 2020 to over $21 trillion by mid-2022 — a roughly $5.5 trillion expansion in two years.

Q: How often is M2 reported?

The Federal Reserve publishes M2 weekly, every Tuesday afternoon, in the H.6 Money Stock Measures statistical release. A monthly average series (M2SL — seasonally adjusted) is the most-commonly-referenced version. The Fed publishes both Not Seasonally Adjusted (NSA) and Seasonally Adjusted (SA) versions.

Q: What is the difference between M1 and M2?

M1 is a narrower aggregate: currency + checking deposits + (since the 2020 redefinition) savings deposits. M2 is broader: M1 + small time deposits + retail money market funds. Before 1990, M1 was the most-watched aggregate. Today M2 is preferred because most money sits in savings-type accounts that count toward M2 but historically didn't count toward M1. After the 2020 redefinition, M1 jumped trillions overnight from a methodology change — not a real liquidity event. M2 is the cleaner long-history series.

Q: Why does M2 matter for investors?

M2 captures the cumulative effect of every Fed policy action — open market operations, QE, QT, reserve requirements — on the actual money supply. Watching M2 directly is often more informative than watching the Fed's communications, because M2 reflects what's actually happening rather than what's being said. M2 is also one of the cleanest leading indicators for the liquidity environment that drives equity, bond, and commodity prices.

Q: How is M2 different from QE?

QE (quantitative easing) expands the Fed's balance sheet by buying assets, which credits bank reserves. Those reserves can flow into M2 via deposit creation, but the two aren't identical. The Fed can run QE without much M2 growth if banks hoard reserves rather than lending. Conversely, M2 can grow without QE through private credit creation (bank lending). M2 captures the actual money in circulation; QE measures one tool the Fed uses to influence it.

Free M2 money supply tracker — the Federal Reserve's M2 series plotted against the S&P 500, with year-over-year growth, the post-2020 expansion in historical context, and the rare 2022–2023 contraction. The cleanest public read on US monetary expansion / contraction and its impact on equity prices.See methodology.

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SystemTrader

Source

Federal Reserve M2 money stock (M2SL, seasonally adjusted), via FRED

Methodology

Weekly M2 plotted against SPY closes; year-over-year change computed on the seasonally-adjusted series

Updates

Weekly (Tuesdays) with monthly H.6 release

Last: 2026-05-14

⚠ For educational and informational purposes only — not financial advice. Past performance does not guarantee future results. See full disclaimer.

M2 Growth Regime

2026-05-14

NORMAL

+4.8% YoY

M2 growing within historical range (~6% long-term average)

M2 Total

$22.69T

Long-Term Avg YoY

≈ +6%

SPY Price

$748.17

M2 Money Stock

Last Data: Mar 2026

Last Release: Apr 28, 2026

Next Release: May 26, 2026

$22.69T

$22,686 billion

M2 Year-over-Year Growth

Last Data: Mar 2026

+4.85%

Data Sources

M2: Federal Reserve H.6 Money Stock Measures (M2SL — seasonally adjusted), accessed via FRED M2SL

SPY: S&P 500 ETF daily OHLCV (1993-02-02 → 2026-05-14).

Units: Billions of Dollars, Seasonally Adjusted, Monthly.

How M2 Money Supply Tracker Works

1
Pull the Fed's weekly M2 release
The Federal Reserve publishes M2 weekly on Tuesdays (with a monthly statistical release as well). M2 = currency in circulation + checking deposits + savings deposits + small time deposits (CDs <$100k) + retail money market funds. We pull the seasonally-adjusted series (M2SL on FRED) and rebuild the page after each release.
2
Overlay M2 against the S&P 500
The top chart shows total M2 ($, trillions) on the same time axis as SPY closes. The relationship is structural: M2 expansion creates more dollars chasing financial assets, and SPY tends to follow. The 2008–2014 QE era, the 2020–2021 pandemic stimulus, and the 2022–2023 contraction are all visible.
3
Compute year-over-year growth
Year-over-year M2 growth strips out the absolute level (which always trends up nominally with population + GDP growth) and isolates the monetary impulse. Long-term average M2 YoY is approximately +6%. Above +10% is hot, above +20% is extraordinary, negative YoY is rare and disinflationary.
4
Anchor against the historical regimes
M2 YoY contracted in 2022–2023 for the first time since the 1930s — a structurally unusual event triggered by the Fed unwinding pandemic stimulus. Before that, the closest comparable was the early-1990s recession. The chart spans far enough back to put any current reading in context.
5
Update weekly after the Fed release
Data refreshes automatically after each Tuesday release. M2 is one of the highest-frequency monetary indicators publicly available — the weekly cadence is genuinely useful for tracking liquidity shifts in near-real-time.

Who Uses M2 Money Supply Tracker

Macro Investors

Use M2 YoY as a leading indicator for liquidity-driven asset moves. The 2020–2021 M2 explosion preceded the asset bubbles in equities, housing, and crypto by 12–18 months. The 2022 contraction preceded the 2022 bear market.

Inflation Watchers

M2 growth doesn't directly cause inflation (velocity matters too), but persistent M2 growth above ~8% YoY historically correlates with elevated CPI prints 12–24 months later. The 2020–2021 M2 surge → 2022 inflation peak was a textbook example.

Fed Watchers

M2 is the cumulative output of every Fed action — open market operations, reserve requirement changes, QE, QT. Watch M2 growth turn negative as the cleanest signal that monetary tightening is biting.

Long-Term Investors

Compare current SPY levels against M2 to see if equities are tracking, leading, or lagging the underlying monetary expansion. See also the SPY/M2 ratio (linked below) for the formal version of this comparison.

Pro Tips

YoY change matters more than absolute level

M2 always grows nominally (population + productivity + nominal GDP). What's actionable is the rate of change — YoY above +10% is unusual and historically supports asset inflation; YoY below 0% is rare and historically deflationary.

M2 leads, doesn't coincide

M2 changes typically lead financial-asset moves by 6–18 months. The 2020 M2 surge preceded the 2021 asset bubble; the 2022 M2 contraction preceded the 2022 drawdown. Don't expect same-month correlation.

Velocity matters too

M2 × velocity = nominal GDP. Even large M2 expansion may not be inflationary if velocity is collapsing (money sitting in money-market funds, not circulating). The 2010s combined large M2 growth with falling velocity → minimal inflation. The 2020s combined M2 growth with rebounding velocity → inflation.

M2 contraction is genuinely rare

Before 2022, the last YoY M2 contraction was during the 1930s Depression. Any negative YoY print is structurally unusual and worth investigating — typically signals very tight monetary conditions or financial-system stress.

Don't conflate M2 with QE

QE expands the Fed's balance sheet (assets), which can drive M2 up via reserves → deposits, but the two aren't identical. The Fed can do QE without M2 growing much (if banks hoard reserves), and M2 can grow without QE (via private credit creation).

Common Issues & Solutions

Weekly data is volatile▾

Weekly M2 prints can be noisy from settlement timing, holiday effects, and seasonality. Use the seasonally-adjusted series (M2SL) and look at multi-week trends rather than week-to-week moves.

M2 doesn't capture all liquidity▾

M2 excludes institutional money-market funds, repo balances, and the Fed's reverse-repo facility — all of which are meaningful liquidity buffers. The Fed publishes broader aggregates (M3 was discontinued in 2006) but M2 remains the most-watched.

Money definition has changed over time▾

The Fed redefined M2 to include retail money market funds in 2020 (savings and small time deposits had already been included). Long-history comparisons should account for these methodology breaks.

M2 vs M1 confusion▾

M1 (currency + checking deposits) was the most-watched aggregate before 1990 when most money sat in M1. After the 2020 redefinition (which moved savings deposits from M2 into M1), M1 jumped by trillions overnight — not a real liquidity change. M2 is the more reliable long-history series.

Lagging signal for real-time conditions▾

Even weekly M2 lags real-time market liquidity. For minute-to-minute conditions, watch the Fed's reverse-repo balance, SOFR, and Treasury General Account balance. M2 is best for regime classification, not tactical timing.

Frequently Asked Questions

What is M2 money supply?▾

M2 is a Federal Reserve aggregate that measures the broad US money supply: currency in circulation + checking deposits + savings deposits + small time deposits (CDs under $100,000) + retail money market funds. It's the most-watched US monetary aggregate and is published weekly by the Federal Reserve.

Is M2 growing or shrinking right now?▾

Check the YoY % chart on this page for the current reading. The long-term average M2 YoY growth is approximately +6%. Above +10% indicates a hot monetary environment; below 0% (negative YoY) is structurally rare. M2 contracted YoY in 2022–2023 for the first time since the 1930s Depression, then resumed growth in 2024.

Does M2 affect stock prices?▾

Yes — M2 growth tends to lead financial-asset moves by 6–18 months. The 2020–2021 M2 surge (over 25% YoY at peak) preceded the 2021 asset bubble in equities, housing, and crypto. The 2022 M2 contraction preceded the 2022 equity drawdown. The relationship is one of the cleanest macro / equity linkages, though the timing is variable.

What does M2 contraction mean?▾

A year-over-year decline in M2 means the total amount of broadly-defined money in the US economy is shrinking. This is structurally rare — before 2022, the last negative YoY M2 reading was during the 1930s. It typically indicates very tight monetary conditions: the Fed is removing reserves faster than private credit creation can replace them. Historically associated with disinflation/deflation, lower asset prices, and slower economic growth.

What is the relationship between M2 and inflation?▾

Milton Friedman's monetarist framework holds that "inflation is always and everywhere a monetary phenomenon." Empirically, persistent M2 growth above ~8% YoY has historically been followed by elevated CPI prints 12–24 months later. The 2020–2021 M2 surge → 2022 inflation peak was a textbook example. Velocity matters too — even large M2 expansion may not be inflationary if money sits idle (low velocity).

What was the largest M2 expansion in history?▾

M2 grew over 25% year-over-year in 2020–2021, the fastest pace since World War II. The Fed's pandemic-era quantitative easing and fiscal stimulus combined to push M2 from approximately $15.5 trillion in early 2020 to over $21 trillion by mid-2022 — a roughly $5.5 trillion expansion in two years.

How often is M2 reported?▾

The Federal Reserve publishes M2 weekly, every Tuesday afternoon, in the H.6 Money Stock Measures statistical release. A monthly average series (M2SL — seasonally adjusted) is the most-commonly-referenced version. The Fed publishes both Not Seasonally Adjusted (NSA) and Seasonally Adjusted (SA) versions.

What is the difference between M1 and M2?▾

M1 is a narrower aggregate: currency + checking deposits + (since the 2020 redefinition) savings deposits. M2 is broader: M1 + small time deposits + retail money market funds. Before 1990, M1 was the most-watched aggregate. Today M2 is preferred because most money sits in savings-type accounts that count toward M2 but historically didn't count toward M1. After the 2020 redefinition, M1 jumped trillions overnight from a methodology change — not a real liquidity event. M2 is the cleaner long-history series.

Why does M2 matter for investors?▾

M2 captures the cumulative effect of every Fed policy action — open market operations, QE, QT, reserve requirements — on the actual money supply. Watching M2 directly is often more informative than watching the Fed's communications, because M2 reflects what's actually happening rather than what's being said. M2 is also one of the cleanest leading indicators for the liquidity environment that drives equity, bond, and commodity prices.

How is M2 different from QE?▾

QE (quantitative easing) expands the Fed's balance sheet by buying assets, which credits bank reserves. Those reserves can flow into M2 via deposit creation, but the two aren't identical. The Fed can run QE without much M2 growth if banks hoard reserves rather than lending. Conversely, M2 can grow without QE through private credit creation (bank lending). M2 captures the actual money in circulation; QE measures one tool the Fed uses to influence it.

Related Tools

SPY / M2 Ratio

S&P 500 divided by M2 — the formal liquidity-adjusted view of equity valuation. Pairs directly with this page.

Money Market Funds

Total MMF assets — the "dry powder" component of M2. When MMFs spike, equity flows often slow.

Fed Funds Rate

The Fed's primary policy lever — directly drives M2 growth via monetary policy stance.

FINRA Margin Debt

The leverage side of liquidity — when M2 is hot and margin debt is rising fast, asset bubbles tend to form.

CPI Inflation

M2 growth is one input to inflation. Compare M2 YoY today against CPI 12–24 months later for the historical lag.

Cross-Asset Macro Panel

Currencies, yields, metals, energy, crypto — the broader liquidity-sensitive asset complex.

Last updated: 2026-05-14