Sum of the currency held by the public and reserves held by financial institutions with the Federal Reserve Banks. This is the monetary aggregate that the Federal Reserve has control over through its monetary policy. Also called High Powered Money because the effect of changes in monetary base on money supply is magnified by the money multiplier.
Nearby TermsMonetarist Monetary assets and liabilities Monetary base Monetary Control Act of 1980 (MAC) Monetary gold
Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University