TechFlow news, CoinDesk senior analyst James Van Straten stated that in December 2024, the M2 money supply continued to rise, approaching a record high of nearly $22 trillion.
The ongoing expansion of the M2 money supply is a bullish indicator for risk assets, as it signifies increasing liquidity entering the system, which typically flows into risk assets first.
Since January 2024, the M2 money supply has reached new monthly highs consecutively. The M2 money supply influences CPI by affecting inflation trends. Despite the Federal Reserve's active tightening through quantitative tightening and maintaining elevated federal funds rates in an effort to bring CPI down to its 2% inflation target, the M2 money supply continues to grow.
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