Robust growth in liquidity levels in Saudi Arabia hits record high in May 2024

(MENAFN) Saudi Arabia's liquidity levels, representing the money available in the economic system, demonstrated robust growth, peaking at the end of May 2024 at 2,825,715 million riyals (approximately 753.3 billion dollars). This marked an annual growth of 8.6 percent, with an increase of over 222.928 billion riyals compared to the same period in 2023, where the liquidity levels stood at 2,602,786 million riyals. These figures, reflecting the broad and comprehensive concept of the money supply (M3), were highlighted in the monthly statistical bulletin released by the Saudi Central bank for May 2024.

Since the beginning of the year, liquidity has grown by 4 percent, rising more than 104.757 billion riyals from 2,720,957 million riyals at the end of January. Additionally, liquidity levels achieved a monthly growth of 1.2 percent, an increase of about 32.402 billion riyals from 2,793,313 million riyals at the end of April of the same year.

These elevated levels of liquidity are expected to bolster economic and commercial activities, contributing significantly to Saudi Arabia's economic development. This growth aligns with the goals of the Kingdom’s Vision 2030, underscoring the resilience and strength of the banking and financial sector.

Examining the four components of the broad money supply (M3), "demand deposits" emerged as the largest contributor, accounting for 49.2 percent of the total money supply, with a level of 1,390,893 million riyals by the end of May 2024. "Time and savings deposits" followed as the second-largest contributor, recording 889,558 million riyals, making up 31.5 percent of the total. "Other quasi-cash deposits," which include residents’ deposits in foreign currencies, deposits against documentary credits, outstanding transfers, and repurchase (repo) operations by banks with the private sector, reached 314,807 million riyals, contributing 11.1 percent. "Cash in circulation outside banks" was the fourth-largest component, valued at 230,456 million riyals, contributing 8.2 percent to the total money supply (M3).

These levels of liquidity not only support the economic momentum but also reflect the solidity and robustness of Saudi Arabia's financial and banking sectors. 



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