Monthly monetary update
Every month, the Institute of International Monetary Research produces a series of notes analysing the latest monetary trends in the world's largest economies - the USA, China, Japan, India, the UK and the Eurozone - along with an accompanying video.
If you are looking for research from previous years, please go to our Monetary Updates Archive page.
Our most recent regular monthly money note (July 2026) can be accessed here and the latest video (June 2026) here.
July 2026 Summary
In the USA annualised rate of money growth in the first half of 2026 was in the high single digits % and in some months even threatened to rise into the double digits %. Borrowing from banks to finance the Federal deficit was part of the explanation. But the deficit has declined relative to GDP. Perhaps more important the new Fed chairman, Kevin Warsh, has made clear that he wants to reduce the size of the Fed balance sheet. Fed sales of securities to non-banks reduce the rate of money growth. Money growth has slowed in China since March. By contrast, the Indian banking system continues to grow at annual rates in the mid-teens % on the back of booming credit and vigorous supply-side dynamism. With these three economies accounting for roughly 40% of world output, the world economy was heading for above-trend growth in 2026 before the shock of the Iran hostilities. The resumption of these hostilities – and the intensification of the Russia-Ukraine conflict – make conjectures about the world economy in late 2026 and 2027 unusually hazardous. Giant fiscal so-called “fiscal stimulus” in Japan is another puzzle. One feature of that puzzle is that – so far – the enlarged Japanese fiscal deficit seems to have had no impact on money growth.