M0 is currency in circulation, M1 is narrow money (M0 + demand deposits), and M2 is broad money (M1 + time deposits, savings deposits, and other deposits). These are the PBOC's primary monetary aggregates published monthly.
Why it matters: The M1-M2 scissors gap (M1 growth minus M2 growth) is a key signal for economic activity and capital market liquidity. Widening M2 with stagnant M1 suggests funds are parked in savings rather than circulating in the real economy.