Monetary Services Indexes (MSI)
Please accept our sincere apology for the inconvenience due to an error in the Monetary Services Index (MSI) data series.
We located a minor programming error in the code that calculates the MSI data. This error affects all data published beginning with the August 2011 MSI release. We have repaired the error and recalculated the entire series beginning 1967. The revised MSI data have been posted on the MSI web page. Fortunately, data published in the July 2011 release and earlier are not affected by the error.
We appreciate your patience.
Richard Anderson and Barry Jones have produced a new
MSI series representing a comprehensive revision of previous data. Suggested citation of users of the data:
Anderson, Richard G. and Barry E. Jones, "A Comprehensive Revision of the Monetary Services (Divisia) Indexes for the United States", Federal Reserve Bank of St. Louis Review, September/October 2011, pp. 325-359.
The new MSI differ from the earlier series in a number of aspects:
- The components' own rates of return have been revised. The own rate measure for small-denomination
time deposits has been simplified. The implicit return on demand deposits
has been eliminated. In addition, newly collected historical data on deposit rates during
the Regulation Q period are now used for savings and time deposits.
- The levels of aggregation have been changed. Five MSI series are now
available: MSI-M1, MSI-M2, MSI-MZM, MSI-M2M, and MSI-ALL. The five MSI series
differ with respect to their included assets. MSI-M1 and MSI-M2 include the same
assets as the Federal Reserve Board's M1 and M2 aggegates. MSI-MZM includes all
zero-maturity assets, that is, assets that are immediately usable as medium of
exchange -- it includes the same assets as the Federal Reserve Bank of
St. Louis MZM monetary aggregate, including institutional-type money market
mutual funds. MSI-M2M includes the same assets as M2 but omits the
small-denomination time deposits that are included in M2. MSI-ALL
includes all the assets that are included in the previous four aggregates.
It corresponds to the assets in M2 plus institutional money market mutual funds, and
currently is the broadest monetary aggregate that can be produced.
MSI M3 can no longer be constructed due to lack of data, but a historical
series is constructed through February 2006.
- The components of the aggregates are adjusted for the effects of retail deposit sweeping.
- The MSI are now constructed using two alternative benchmark
rate series. Both alternatives are based on an upper envelope of a set of rates that includes the own
rates for the components included in MSI ALL plus selected
short-term money market rates that previously had been used
to construct own rates for components of (discontinued) MSI L. Our "preferred" benchmark
rate equals 100 basis points plus the largest rate in the set of rates. Our alternative benchmark
rate equals the larger of the preferred benchmark rate and the Baa corporate bond
yield. The alternative benchmark rate more closely resembles the one previously
used to construct the MSI (Anderson, Jones and Nesmith, Federal Reserve Bank of St Louis Review, 1997).
The MSI_P file contains our 'preferred' MSI, which are calculated using our preferred benchmark rate.
The MSI_A file contains our 'alternative' MSI which are calculated using our alternative benchmark rate.
The SUMS file contains simple sum monetary aggregates that are directly comparable to the MSI. M2M, MZM and M2
correspond to the monetary aggregates on FRED. M1ADJ is M1 adjusted for retail sweeps, ALL is M2
plus institutional type money market mutual funds.
Download new MSI series (MSI_A.xls)
Download new MSI series (MSI_P.xls)
Download comparable simple sum monetary aggregates (SUMS.xls)
Note that the Monetary Services Indexes are available in FRED also.
The MSI measure the flow of monetary services received each period by
households and firms from their holdings of monetary assets (levels of the indexes
are sometimes referred to as Divisia monetary aggregates). For a survey of the relevant monetary aggregation
theory, see Anderson, Richard G., Jones, Barry E. and Travis D. Nesmith, "Monetary Aggregation Theory and Statistical Index Numbers,"
Federal Reserve Bank of St. Louis Review, January/February 1997, pp. 31-51.
For a shorter overview and details of the current data, see Anderson, Richard G. and Barry E. Jones, "A comprehensive Revision of the
Monetary Services (Divisia) Indexes for the United States," Federal Reserve Bank of St. Louis Review, September/October 2011, pp. 325-359.
Library of Related Publications
We continue to add to our document library working papers and
published articles on the MSI. We urge authors to submit their
papers; published papers must be accompanied by appropriate copyright
information and waivers. Unpublished working papers and
work-in-progress will be reviewed prior to posting.
Some may be rejected. Posting of working papers shall not to be
interpreted or publicized as "publication," nor as an endorsement the Federal Reserve Bank of St. Louis.
Questions or comments can be sent to: