asked the Chancellor of the Exchequer what he considers to be the best independent indicator of the aggregate domestic demand for money; and if he will publish a table showing, for each of the past five financial years, the aggregate domestic demand for money, the aggregate domestic supply of money, the difference between these two aggregates and the percentage increase in each of these two aggregates.
pursuant to his reply [Official Report, 6th November 1978; Vol. 957, c. 58], gave the following information:
My right hon. Friend considers that the Government's monetary objectives can best be quantified by specifying a target range for the rate of growth of the sterling M3 measure of the money stock. But no one indicator can give a full account of the monetary situation and he also takes account of the development of other indicators, including the expansion of domestic credit—DCE.
The growth of the money stock is influenced by a number of factors, some operating from the supply side and others from the demand side. The published figures for money stock reflect the interaction between these demand and supply factors. There are, therefore, no separate series for the demand and supply of money.