Riyadh, December 11, 2024 – Liquidity levels in the Saudi economy have shown robust growth, reaching SAR 2,936.089 billion by the end of October 2024, marking a notable increase of 9.2% year-on-year compared to SAR 2,688.442 billion in the same period of 2023. This growth, amounting to more than SAR 247.647 billion, highlights the continued strength and resilience of Saudi Arabia’s financial sector, driven by a rise in the broad money supply indicator (M3). The data, released in the Saudi Central Bank’s (SAMA) monthly statistical bulletin for October 2024, underscores the Kingdom's stable monetary conditions, which contribute significantly to overall economic development.
On a quarterly basis, liquidity levels also showed a positive trend, growing by 1.5%, or approximately SAR 45 billion, with the total reaching SAR 2,943.661 billion by the end of Q3 2024, compared to SAR 2,898.706 billion at the close of Q2 2024. This quarterly increase further reflects the consistent and healthy liquidity dynamics within the Saudi financial system, providing a solid foundation for sustained economic activity and growth.
Since the start of 2024, liquidity in the Saudi economy has surged by 8%, adding over SAR 215 billion to the initial figure of SAR 2,720.957 billion at the beginning of the year. This increase highlights the continuous inflow of funds and growing investor confidence, playing a pivotal role in supporting both economic and commercial activity across various sectors. As liquidity levels rise, they become a significant driver for the Kingdom’s economic expansion, fostering conditions conducive to business growth, investment, and consumer confidence.
Breaking down the components of liquidity, the largest contributor is Demand Deposits, which account for 49% of the total liquidity, amounting to SAR 1,425.489 billion by October 2024. These deposits, which are readily accessible by account holders, serve as a key indicator of consumer and business confidence in the stability of the banking system.
The second-largest contributor to liquidity is Time and Savings Deposits, which make up 33% of the total, reaching SAR 971.103 billion. These deposits typically offer higher interest rates, reflecting a shift toward longer-term savings and investments, which can signal optimism regarding future financial stability and growth.
The third-largest contributor is Quasi-Monetary Deposits, totaling SAR 312.506 billion, or 11% of the total liquidity. These deposits include residents' foreign currency deposits, deposits linked to letters of credit, outstanding transfers, and repurchase agreements (repos) executed by banks with the private sector. These deposits play a critical role in supporting international trade and financial transactions, further emphasizing the Kingdom’s integration into global financial markets.
In addition to these deposit categories, Currency in circulation outside banks contributed to 8% of the total liquidity, amounting to SAR 226.991 billion. This represents cash in circulation among the general public and is an important indicator of consumer spending behavior and confidence in the local economy.
The robust liquidity levels in Saudi Arabia provide a strong foundation for continued economic growth and financial stability. As liquidity is closely tied to various economic activities, including domestic consumption, business investments, and the facilitation of trade, the Kingdom's monetary system remains resilient and conducive to supporting sustained development. With such liquidity growth, Saudi Arabia is well-positioned to maintain its momentum in key sectors, ensuring a favorable economic climate for both domestic and international stakeholders.