M1 money supply includes coins and currency in circulation, money that the U.S. Treasury does not hold at the Federal Reserve Bank or in bank vaults. The M1 money supply also includes amounts held in checking accounts. Together, currency and checking accounts in banks, are added up to make up M1, which the Federal Reserve System measures daily. The money supply is just one metric used by the central bank monitor consumer behavior and gauging economic and financial conditions.
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