Question

How are interbank deposits treated in the money supply?

Options

• They are included as total deposits with Post Office savings organisations in M4.

• They are included as CU in M1.

• They are included as savings deposits with Post Office savings banks in M2.

• They are not regarded as part of the money supply.

Answer 1

Interbank deposits are deposits that a commercial bank holds in other commercial banks. Such deposits are excluded from the money supply.