Quarterly Prediction of Reserve Money Multiplier and Money Stock in India

For a closer forecasting and control of money stock, movements in the reserve money and in the reserve money multiplier both need to be watched. Between the two, the variations in the former are decidedly the more dominant. But those in the latter are not negligible at all. Besides, minor variations in the multiplier cause large absolute changes in the money stock. The present study concentrates on examining the variations in the multiplier, assuming that the variations in the reserve money will be examined separately.