Liquidity levels, or available money, in Saudi Arabia’s economy, have grown by more than SAR247.647 billion or 9.2 percent to SAR2.936 trillion by the end of October 2024, compared with SAR2.688 trillion during the same period last year.
The Saudi Central Bank’s monthly statistical bulletin for October 2024 said that this growth is based on the broad money supply indicator (M3). Quarterly, liquidity levels grew by 1.5 percent, an increase of approximately SAR45 billion, reaching SAR2.943 trillion by the end of Q3 2024, compared to SAR2.898 trillion by the end of Q2 2024.
Liquidity grows 8 percent this year
Since January 2024, liquidity in Saudi Arabia’s economy has increased by 8 percent, adding over SAR215 billion from its starting level of SAR2.720 trillion. The robust liquidity levels serve as a driver for economic and commercial activity, contributing to positive progress in the Kingdom’s economic development.
In October, demand deposits were the largest contributor at 49 percent, recording SAR1.425 trillion. Meanwhile, time and savings deposits were the second-largest contributor, accounting for 33 percent of the total with a value of SAR971.103 billion.
The third-largest contributors were the quasi-monetary deposits, which amounted to SAR312.506 billion or 11 percent of the total. Quasi-monetary deposits refer to residents’ foreign currency deposits, deposits tied to letters of credit, outstanding transfers and repurchase agreements (repos) executed by banks with the private sector.
Saudi Arabia’s central bank also revealed that currency in circulation outside banks contributed to 8 percent of the total liquidity, with a value of SAR226.991 billion. Saudi Arabia’s growing liquidity levels highlight the economy’s strong monetary foundation, supporting sustained growth and financial stability.
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Banking sector outlook
In its latest banking sector outlook, Fitch Ratings said that banks operating in Saudi Arabia will see strong credit growth in 2025, driven by high crude prices and growth in the non-oil economy. Fitch Ratings expects banks in Saudi Arabia to witness a 12 percent expansion in financing next year, around twice the average of the Gulf Cooperation Council region. Corporates will account for almost 65 percent to 70 percent of new financing among Saudi banks in 2025.
Fitch forecasts real non-oil GDP growth to average a still strong 4.5 percent over 2024–2025, compared to 5 percent over 2022–2023. It also expects the sector’s financial metrics to remain strong in 2025.
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