An Overview of Money Supply and Money Multiplier in India: 2016-2023

Author(s)	Dr. Jaspreet Kaur
Country	India
Abstract	This research paper investigates the dynamics of money supply and money multiplier in India during the period 2016–2023. The analysis focuses on the structural composition of narrow money (M1), broad money (M3), reserve money, and their respective multipliers. The study evaluates the changing contribution of currency with the public, demand deposits, and time deposits within the broader monetary framework. The structural disruptions such as demonetization, digital payment expansion, inflationary pressures, and the COVID-19 pandemic play a predominant role in causing variations in money supply . This research paper uses secondary data available on Handbook of Statistics on the Indian Economy. The study takes into account the behavior of these variables over the time with the results pointing indicate moderate variability in the money multiplier, a dominant contribution of time deposits in broad money formation, and a shifting pattern in currency holdings due to macroeconomic and policy shocks. The findings underline the evolving nature of monetary transmission in India and highlight the role of institutional and behavioral factors in shaping liquidity conditions.
Keywords	Money Supply, Narrow Money, Broad Money, Money Multiplier, Reserve Money, Monetary Policy, India
Field	Business Administration
Published In	Volume 7, Issue 2, March-April 2026
Published On	2026-03-05

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