The distribution of water in the Moon’s interior carries key implications for the origin of the Moon1, the crystallisation of the lunar magma ocean2, and the duration of lunar volcanism2. The Chang’E-5 (CE5) mission returned the youngest mare basalt samples, dated at ca. 2.0 billion years ago3, from the northwestern Procellarum KREEP Terrane (PKT), providing a probe into the spatio-temporal evolution of lunar water. Here we report the water abundance and hydrogen isotope composition of apatite and ilmenite-hosted melt inclusions from CE5 basalts, from which we derived a maximum water abundance of 370 ± 30 μg.g-1 and a δD value (-330 ± 160‰) for their parent magma. During eruption, hydrogen degassing led to an increase in the D/H ratio of the residual melts up to δD values of 300-900‰. Accounting for low degrees of mantle partial melting followed by extensive magma fractional crystallisation4, we estimate a maximum mantle water abundance of 2-6 μg.g-1, which are too low for water contents alone to account for generating the Moon’s youngest basalts. Such modest water abundances for the lunar mantle are at the lower end of those estimated from mare basalts that erupted from ca. 4.0-2.8 Ga5, 6, suggesting the mantle source of CE5 basalts dried up by ca. 2.0 Ga through previous melt extraction from the PKT mantle during prolonged volcanic activity.