US M2 has fallen to -4%! Unseen since the 1930s

The U.S. money supply is contracting at the fastest pace since the Great Depression of 1930 in the wake of the banking crisis.
According to data released by the Federal Reserve on April 24, the U.S. M2 money supply (not seasonally adjusted) was $20.7 trillion in March, down 4.05% year-over-year and the largest year-over-year decline on record. This was almost twice the 2.2% decline in February and the fourth consecutive month of contraction for that money supply.

M2 is a type of monetary supply, and its continuous decline means that there is less money flowing in the economy and less funds available for banks to lend, which can lower prices to help cool down the economy and also slow down inflation. The decline in M2 could push inflation even lower and potentially have an impact on the Federal Reserve's interest rate decisions.

Whether M2 will continue to decline and when it will accurately reflect in inflation has been a controversial issue. Although M2 has an impact on inflation, this effect generally lags behind for approximately one year. Some economists believe that a significant decline in M2 could indicate that the economy may be moving towards deflation and could also mean a recession is coming soon.