The liquidity levels of Saudi Arabia’s economic system have witnessed remarkable growth, reaching over SAR2.823 trillion ($753 billion) by the end of March 2024. The Saudi Central Bank (SAMA) reported that this surge in liquidity reflects a significant annual increase of 8.3 percent, amounting to SAR215 billion.
Liquidity supports economic growth
Saudi Arabia’s broad money supply reflects robust liquidity levels, indicating a monthly growth of 2.5 percent, equivalent to SAR67.553 billion. These liquidity levels play a crucial role in stimulating economic and commercial activity. Moreover, they significantly contribute to gross domestic product (GDP) growth and support the objectives outlined in Saudi Vision 2030.
SAMA attributes the surge in total money supply to the increase in demand deposits, which represent the largest contributor to the overall total, accounting for about 49.8 percent. Demand deposits reached a value of SAR1,407,114 million, reflecting an annual growth of 3.9 percent. On a monthly basis, demand deposits experienced a 4.4 percent growth rate, with an increase exceeding SAR59.864 billion.
Meanwhile, time and savings deposits, the second-largest contributor to the total money supply (29.9 percent), also experienced substantial growth. Savings deposits saw a 20.7 percent annual increase in March, exceeding SAR44 billion.
Read: Saudi Aramco reports Q1 2024 net income of $27.2 billion
Currency in circulation
Currency in circulation outside banks in Saudi Arabia contributed around 8.1 percent or SAR227.491 billion to the country’s liquidity. Moreover, it experienced an annual increase exceeding SAR19.938 billion, reflecting a growth rate of 9.6 percent.
Meanwhile, quasi-money deposits accounted for around 12.2 percent of Saudi Arabia’s total money supply, with a value of SAR345.892 billion. These deposits include resident deposits in foreign currencies, deposits for documentary credits, existing transfers, and repurchase agreements (repos) of banks within the private sector.
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