Global Liquidity Watch: Weekly Update

Global liquidity levels have risen steadily through July

Global liquidity levels have risen steadily through July following a disappointing June. The main driver has been improving collateral values as bond markets respond to encouraging US inflation data. But latest data record a long-awaited uptick in Central Bank liquidity too. This is due to the People’s Bank of China which has been injecting liquidity in size in recent days. We are still waiting for the US Federal Reserve but for the moment we have to be content with a stable Fed.