IMF experts proposed to change the approach to managing the money supply

Since the beginning of the 2020s, an increase in the money supply has had a stronger effect on inflation in developed economies, and therefore central banks should tighten their control over emissions. Experts from the International Monetary Fund (IMF) warned about this.

As follows from IMF observations of broad money (M3, which includes, in addition to money in circulation and term deposits, long-term savings and debt securities), the effect of its sharp increase in the US and the eurozone was most pronounced in periods when price growth was already impetuous. Such a relationship was observed with an increase in emission in the mid-1970s – early 1980s. At the same time, similar jumps had almost no effect on prices during the period from the 1990s to the end of the 2010s, when inflation remained low in both the US and the Eurozone. In the early 2020s, when goods and services began to rise in price rapidly, the relationship between M3 and prices strengthened again.