M1 Money Supply

M1 Money Supply refers to the total amount of liquid money available in an economy at a given time. It includes physical cash, like coins and paper money, as well as demand deposits, which are funds in checking accounts that can be easily accessed for spending. M1 is crucial because it reflects the most immediate forms of money people can use for transactions. Monitoring M1 helps economists and policymakers understand economic activity and make decisions about monetary policy to manage inflation and stimulate growth when necessary.