A literature review on the topic is provided in Section 2, and in Section 3 recent developments in broad money demand and its determinants are described. Possible reasons for changes in the income velocity of circulation of money aggregates are also given in this section. The error-correction model (ECM) for the demand for M3 is described in Section 4. Both the long-run and short-run dynamic behavioural patterns of M3 are analysed in Section 5. This section also gives the finding that some of the parameters of the money demand function are time varying.  Finally, in Section 6, ex ante forecasts are used to judge the performance of the fixed-coefficient ECM and the alternative varying-parameter regression specifications. The paper concludes with some brief remarks on the validity of the study