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Economic Commentary

Monetary Policy and the M2 Target

As 1989 comes to an end, the levels of nominal GNP and the M2 aggregate seem to be in balance, as M2 growth has slowed to a 4 to 5 percent range in the past three years. The Federal Reserve’s tentative target range for M2 growth in 1990 permits ample opportunity for the inflation rate to decline in the next few years.

The views authors express in Economic Commentary are theirs and not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System. The series editor is Tasia Hane. This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. This paper and its data are subject to revision; please visit for updates.

Suggested Citation

Black, Susan A., and William T. Gavin. 1989. “Monetary Policy and the M2 Target.” Federal Reserve Bank of Cleveland, Economic Commentary 12/1/1989.