Broad money to total reserves ratio

This financial metric represents the relationship between the total amount of money available in an economy and the reserves held by its central bank. Broad money encompasses liquid assets such as currency, demand deposits, time and savings accounts, as well as various securities like certificates of deposit, signifying the overall money supply accessible to the public. Meanwhile, total reserves include the central bank’s asset holdings intended to manage monetary policy and ensure liquidity. By analyzing this ratio, economists and policymakers can gauge the potential for money creation within the banking system, assess economic stability, and evaluate how well an economy can meet its liquidity needs, particularly in times of financial distress. Source: