1. M1 consists of (1) currency outside the U.S. Treasury, Federal Reserve Banks,
and the vaults of depository institutions; (2) travelers checks of nonbank issuers;
(3) demand deposits at commercial banks (excluding those amounts held by depository
institutions, the U.S. government, and foreign banks and official institutions) less
cash items in the process of collection and Federal Reserve float; and (4) other
checkable deposits (OCDs), consisting of negotiable order of withdrawal (NOW) and
automatic transfer service (ATS) accounts at depository institutions, credit union
share draft accounts, and demand deposits at thrift institutions. Seasonally
adjusted M1 is constructed by summing currency, travelers checks, demand deposits,
and OCDs, each seasonally adjusted separately.
2. M2 consists of M1 plus (1) savings deposits (including money market deposit
accounts); (2) small-denomination time deposits (time deposits in amounts of less
than $100,000), less individual retirement account (IRA) and Keogh balances at
depository institutions; and (3) balances in retail money market mutual funds,
less IRA and Keogh balances at money market mutual funds. Seasonally adjusted M2
is constructed by summing savings deposits, small-denomination time deposits, and
retail money funds, each seasonally adjusted separately, and adding this result
to seasonally adjusted M1.
3. M3 consists of M2 plus (1) balances in institutional money market mutual funds;
(2) large-denomination time deposits (time deposits in amounts of $100,000 or more);
(3) repurchase agreement (RP) liabilities of depository institutions, in denominations
of $100,000 or more, on U.S. government and federal agency securities; and
(4) Eurodollars held by U.S. addressees at foreign branches of U.S. banks worldwide
and at all banking offices in the United Kingdom and Canada. Large-denomination time
deposits, RPs, and Eurodollars exclude those amounts held by depository institutions,
the U.S. government, foreign banks and official institutions, and money market mutual
funds. Seasonally adjusted M3 is constructed by summing institutional money funds,
large-denomination time deposits, RPs, and Eurodollars, each adjusted separately,
and adding this result to seasonally adjusted M2.