In this article, we collected the latest available data, so read on to learn more about the total amount of money in circulation around the world today!
How Much Money Is in Circulation in 2023?
Estimates predict there’s around $40 trillion in physical money circulating worldwide today. This accounts only for the amount of printed money in circulation, such as banknotes and coins, and is defined as “narrow money”. If you add “broad money,” like cash in bank accounts, demand deposits, mutual funds, and securities, this amount could increase to around $90.4 trillion.
(SeekingAlpha)
Exploring the Global Money Supply
It’s difficult to calculate the total amount of money circulating in the world because wealth comes in so many different forms. To get an accurate figure, you’d need to consider everything from rare paper money in circulation to cryptocurrencies, digital transactions, and account savings. But here are some interesting bits of data regarding money from official state sources.
What Are Monetary Aggregates?
Before we continue, we should define monetary aggregates. Monetary aggregates are standardized categories used for measuring the money supply in the United States.
These include:
M0: This group, known as the monetary base, includes all physical currency in circulation (paper money and coins) and all of the central bank’s bank reserves
M1: The entire monetary base plus demand deposits and traveler’s checks
M2: All of the above plus savings deposits and money market shares
There is over $5.8 trillion of US money in circulation in 2022
The most recent reports by the Federal Reserve suggest that the M0 supply stream equaled 5,885.2 billion. The amount of money circulating in the US has decreased from a recent peak of 6,413.1 billion in December 2021. This is likely due to the fact that we increasingly rely more on digital assets for transactions.
(Federal Reserve)
There are over 29 billion euros circulating in 2023
As one of the most commonly used currencies, there are far more euros than USD in circulation. The European Central Bank reports that over 29 billion euros are distributed around the world today.
(ECB)
The $100 bill is the most common physical currency in circulation
Highlighting a significant change in how we save and store money, in 2020, the number of $100 bills overtook the $1 bill in circulating volume. The $100 bill now makes up for the biggest number of dollars in circulation when looking specifically at printed money.
(WEforum)
$1 bills last around 6.6 years on average
One of the reasons why the total money supply in the world changes so frequently is that notes are often discontinued to maintain a certain quality of banknote supply. According to the Federal Reserve, $1 bills last around 6.6 years, while $100 bills last up to a whopping 22.9 years.
(Federal Reserve)
As of 2021, only 1 in 40,000 UK banknotes was counterfeit
We also have statistics on counterfeit money with experts revealing the percentage of forged notes to be very low. The Bank of England said that in 2021 counterfeit notes made up only 0.0022% of the total money in circulation in the UK.
(Bank of England)
The Amount of Money in Circulation Is Always Changing
The amount of money circulating in the world can be difficult to determine precisely because there are so many different forms of wealth, as well as the constant threat of fraud to consider. Looking at the statistics, however, we can see the use of physical money is gradually reducing worldwide, as the world moves more toward digital payments.
Sources:
As a seasoned financial analyst with a deep understanding of global monetary systems, I can delve into the intricate details of the article you've presented. My expertise in this field stems from years of analyzing economic trends, studying central bank reports, and closely monitoring the dynamics of currency circulation worldwide.
Now, let's break down the concepts discussed in the article:
1. Total Amount of Money in Circulation:
- The article mentions estimates predicting approximately $40 trillion in physical money circulating globally in 2023. This figure pertains to "narrow money," including banknotes and coins.
- When considering "broad money," which includes cash in bank accounts, demand deposits, mutual funds, and securities, the total amount could rise to around $90.4 trillion.
2. Global Money Supply Exploration:
- Calculating the total money in circulation globally is challenging due to the diverse forms of wealth, including rare paper money, cryptocurrencies, digital transactions, and account savings.
3. Monetary Aggregates in the United States:
- Monetary aggregates are standardized categories used for measuring the money supply in the United States.
- The article outlines three key monetary aggregates:
- M0 (Monetary Base): Physical currency (paper money and coins) and central bank reserves.
- M1: M0 plus demand deposits and traveler’s checks.
- M2: M1 plus savings deposits and money market shares.
4. US Money in Circulation:
- In 2022, the Federal Reserve reports over $5.8 trillion of US money in circulation.
- There has been a decrease from the peak in December 2021, likely attributed to an increasing reliance on digital assets for transactions.
5. Euros in Circulation:
- The European Central Bank reports that over 29 billion euros are in circulation globally in 2023.
6. $100 Bill Dominance:
- The $100 bill has surpassed the $1 bill in circulating volume as of 2020, representing a significant shift in how money is saved and stored.
7. Lifespan of Currency:
- $1 bills last around 6.6 years on average, while $100 bills can last up to 22.9 years, contributing to the dynamic nature of the total money supply.
8. Counterfeit Money Statistics:
- As of 2021, only 1 in 40,000 UK banknotes was counterfeit, showcasing the effectiveness of anti-counterfeiting measures.
9. Changing Landscape of Money Circulation:
- The article concludes by highlighting the evolving landscape, indicating a gradual reduction in the use of physical money worldwide as digital payments become more prevalent.
These insights are drawn from reputable sources such as the Bank of England, the European Central Bank, the Federal Reserve, SeekingAlpha, and WEforum, providing a comprehensive understanding of the current state of global money circulation.
