Educatione money suplay (Forex)

Money Circulation, also known as Money Supply, is the total amount of currency in circulation in an economic cycle. This understanding may sound a little strange, how to calculate the total amount of currency in circulation, is not possible by counting one by one.

But now the technology is very advanced, considering that the majority of economic systems use fiat currency and computer use, making the government and central banks quickly able to calculate the amount of money circulating in the market (economic wheel).




Understanding the amount of money supply circulating in the economy is very important for us as a currency market actor (forex trader), because the amount of money supply has a direct impact on the value of the currency.

Just like other economic principles, when more money is circulated it tends to make the value of the currency move lower. Likewise vice versa when less money is circulated tends to make the value of the currency move higher. We will not discuss in detail in this paper how to find out the total amount of money in circulation or with certain formulas, because this is only a basic discussion of the money supply alone.

The amount of supply of currency in circulation in a country is usually controlled by

Ministry of Finance (Government) Central Bank