Largest Money Growth Since January 2013…

Today’s CFS Divisia M4 release highlights the fastest broad money growth rate since January 2013.  CFS Divisia M4 – the broadest and most important measure of money – grew by 5.9% in June 2016 on a year-over-year basis versus 2.8% one year earlier.

The last time that CFS DM4 growth approached this level, nominal GDP began an advance from 2.9% to 4.1%.  CFS data signals that nominal GDP will likely push meaningfully higher than the 3.3% year-over-year growth in Q1 2016.

Commercial bank savings deposits, demand deposits, and repurchase agreements are contributing to more rapid money growth.  Whereas, time deposits at commercial banks and thrifts are modestly weighing down the aggregates.  Nonetheless, growth – on balance – is very positive.

For more info on CFS Divisia, please see “Why CFS Divisia Money Matters, Now!” –
http://centerforfinancialstability.org/research/why_cfs_divisia_071316.pdf

For Monetary and Financial Data Release Report:
http://www.centerforfinancialstability.org/amfm/Divisia_Jun16.pdf

Bloomberg terminal users can access our monetary and financial statistics by any of the four options:

1) {ALLX DIVM }
2) {ECST T DIVMM4IY}
3) {ECST} –> ‘Monetary Sector’ –> ‘Money Supply’ –> Change Source in top right to ‘Center for Financial Stability’
4) {ECST S US MONEY SUPPLY} –> From source list on left, select ‘Center for Financial Stability’

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