Britain’s Falling Money Supply Clouds Chance of a Brisk Rebound
- Monetarists predicted double digit inflation and recession
- M4 has lost favor as an indicator for mainstream economists
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The UK’s broad measure of money supply continued to fall at the start of 2024, leaving economists who follow the measure warning against any brisk bounce back from a recession that hit last year.
Bank of England data out this week showed that a closely watched measure of M4 money supply declined in the first two months of 2024, sinking 1.1% in February compared to a year ago. The UK is also trailing the bounce backs in money supply seen in the US and eurozone.