Global Monetary Base - Update through March 2025 and 2025 Forecast

InfraCap Report Update, New York, NY ~  The team at Infrastructure Capital Advisors tracks the Global Monetary Base, defined as currency in circulation plus bank reserves, as an indicator of current and future interest rates. This article provides data and insights through March 2025 with data released in April 2025.

March Global Monetary Base (GMB):

GMB grew by 0.5% MoM but has fallen by $580 billion or 2.3% over the last twelve months. Inflation is caused by excessive monetary growth, but the money supply has shrunk by 4% over the last two years. We expect that the GMB will stabilize over the next quarter and start growing in 2025 as the European Central Bank (ECB) and the Peoples Bank of China (PBOC) are forced to ease monetary policy in response to a recession in Europe and slower global growth. Recent economic data show that inflation continues to steadily moderate with recent CPI core coming in at 0.1% and PPI falling by 0.1%. We forecast that Core PCE will come in at a cool 0.1% at month end.

If the Global Monetary Base remains flat through 2025, we expect interest rates to stabilize and decline as central banks cut rates in response to slow or negative growth. Declining global interest rates and a flat to increasing GMB will support the global stock and bond markets.

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