Monetary base

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In economics, the monetary base (also base money, money base, high-powered money, reserve money, outside money, central bank money or, in the UK, narrow money) in a country is the total amount of money created by the central bank. This includes:

• the total currency circulating in the public,
• plus the currency that is physically held in the vaults of commercial banks,
• plus the commercial banks' reserves^[1] held in the central bank.^[2]

The monetary base should not be confused with the money supply, which consists of the total currency circulating in the public plus certain types of non-bank deposits with commercial banks.