U.S. M2 Breaks Through $23 Trillion to Hit New Highs, Sparking "Liquidity-Driven Bubble" Debate

Odaily reported that according to the latest data from the U.S. Federal Reserve, the broad money supply (M2) after seasonal adjustment in May rose to $23.05 trillion, breaking through the $23 trillion mark for the first time and hitting a record high. M2 has been rising for five consecutive months since the beginning of the year, growing from $22.43 trillion in January by a cumulative total of approximately $623 billion, with a month-over-month increase of about $247.8 billion, indicating continuous expansion in liquidity.

Some industry insiders believe this growth may reflect the Fed's re-release of liquidity after the tightening cycle, sparking discussions of a "return of monetary easing." However, mainstream economic perspectives point out that money supply typically grows naturally with the size of the economy, and the current increase can also be seen as a correction to previous contractions.

At the asset pricing level, the market is broadly focused on the potential impact of liquidity on risk assets. Crypto assets like Bitcoin, due to their limited supply, are viewed by some investors as a tool to hedge against currency devaluation, and the related narrative of a "liquidity-driven market" is once again heating up.

At the same time, global central banks continuing to increase gold holdings as reserve assets are also seen as an indirect hedge signal against the long-term stability of the fiat currency system. The next M2 data release is scheduled for late July, and the market will continue to observe whether the liquidity expansion will persist. (Bitcoin News)