Today, I've taken things one step at a time by initially defining and explaining the money supply. I've then moved on to the definition and explanation of the monetary base, of M1 as well as M2. Broad money: M1 Notes and coins in circulation with the non-bank public plus sterling current accounts. M2 M1 plus sterling time deposits with up to three months’ notice, or up to two years’ fixed maturity. M3 M2 plus repurchase agreements, money market fund units, and debt securities up to two years. M3 is a measure of the money supply that includes M2 as well as large time deposits, institutional money market funds, short-term repurchase agreements and larger liquid assets. The M3 measurement includes assets that are less liquid than other components of the money supply and are referred to as "near,