In the euro area, three monetary aggregates are used to measure the amount of money in the economy: M1, M2 and M3. They are differentiated based on the ease and speed with which their underlying monetary instruments can be converted for payments.

Methodology

Monetary aggregates are derived from the consolidated balance sheet of the monetary financial institutions (MFI) sector and short-term deposit liabilities of post offices and specific central government entities. They consist of short-term liabilities to the money-holding sector (i.e. non-MFI euro area residents, excluding central government).

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