M0 is the reserve money or Central Bank money and is given as = Currency in circulation + Bankers’ deposits with the RBI + ‘Other’ deposits with the RBI
= Net RBI credit to the government + RBI credit to the commercial sector + RBI’s claims on banks + RBI’s net foreign assets + Government’s currency liabilities to the public – RBI’s net nonmonetary liabilities
it is therefore not used to tell liquidity in the system
M1 is the most liquid as it tells the liquidity in the system
MI = = Currency with the public + Demand deposits with the banking system + ‘Other’ deposits with the RBI
Currency with the Public + Current Deposits with the Banking System + Demand Liabilities Portion of Savings Deposits with the Banking System + 'Other' Deposits with the RBI
If you are enrolled in Our course then refer to "Monetary aggregates note under RBI & Monetary policy".