Saudi Arabia's Economic Liquidity Peaks At SAR2.9 Trillion In Second Quarter Of 2024

The Saudi economy's available funds have grown by 9% year-over-year, reaching SAR2.898706 trillion by the end of Q2 2024, a historic high. The Saudi Central Bank (SAMA) reported in July that liquidity in Q2 2024 increased by SAR238.15 billion from SAR2.660556 trillion in Q2 2023, reflecting broad money (M3).

Quarterly, liquidity rose by 3%, with an increase of SAR74.96 billion compared to the end of Q1 2024 when it was SAR2.823745 trillion. From January's start, liquidity grew by 5.5%, rising over SAR148.83 billion from SAR2.720957 trillion at January's close.

By July's end, liquidity reached SAR2.869788 trillion. These strong liquidity levels boost the economic and commercial framework, aiding positive economic development rates.

Demand deposits, the largest component at 49%, totaled SAR1.421423 trillion by Q2 2024's end. Time and savings deposits were the second largest at 31%, amounting to SAR903.712 billion during the same period.

The third major contributor to broad money (M3), estimated at 12%, was other quasi-monetary deposits, reaching SAR344.384 billion. Currency in circulation outside banks stood at SAR229.187 billion, making up about 8% of the total.

Breakdown of Quasi-Money Deposits

Quasi-money deposits include residents' foreign currency deposits, deposits secured by letters of credit, ongoing transfers, and repurchase agreements (repos) conducted by banks with the private sector.

Domestic liquidity comprises M1, which includes currency in circulation outside banks along with demand deposits exclusively; M2 consists of M1 plus time and savings deposits; and broad money M3 encompasses M2 along with other quasi-money deposits.

"These robust liquidity levels serve as a catalyst for the economic and commercial framework," stated SAMA's report.

The steady growth in liquidity highlights Saudi Arabia's financial stability and its ability to support ongoing economic activities effectively.

With inputs from SPA