U.S. M2 exceeds $23 trillion, renewing all-time high, sparking "liquidity-driven bubble" debate

Odaily Odaily Planet Daily News The latest data from the U.S. Federal Reserve shows that 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, setting a new historical high. M2 has risen 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-on-month increase of about $247.8 billion, indicating sustained liquidity expansion.

Some industry insiders believe this increase may reflect the Federal Reserve's re-release of liquidity after the tightening cycle, sparking discussions about a "return to monetary easing." However, mainstream economic viewpoints 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. Bitcoin and other crypto assets, due to their limited supply, are viewed by some investors as a hedge against currency devaluation, and the related narrative of a "liquidity-driven market" is once again gaining traction.

Meanwhile, central banks globally continue to increase their gold reserves as a reserve asset, which is also seen as an indirect signal of hedging against the long-term stability of the fiat currency system. The next M2 data will be released in late July, and the market will continue to observe whether liquidity expansion persists. (Bitcoin News)