Global Liquidity Watch: Weekly Update

Sliding Dollar Behind US$1.5tr Weekly Rise in Global Liquidity

Global liquidity levels rose by a whopping US$1.49tr last week. Two-thirds of this increase can be attributed to the slide in the US dollar. Year-to-date global liquidity is up US$5.3tr and has surpassed the previous all-time high of US$175.8tr recorded last September. The factors that held liquidity growth in check last year – weak Central Bank liquidity and a strong US dollar – reversed in Q1. There are reasons to be cautious as we start Q2. That said, liquidity impacts risk asset markets and cryptocurrencies with a delay of around 3 months. The Q1 upturn should help them to recover in Q2.