Global Liquidity Update - Shifts and Expectations

This past week marked another reduction in the Federal Reserve Bank credit, contrasting sharply with the People's Bank of China (PBoC), which injected a substantial RMB 852.2 billion into the markets through various programs.

As central banks globally begin to adopt more favorable policies, we anticipate a notable increase in liquidity in the coming months, with the Fed playing a central role in this easing cycle.

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Despite a slight dip in the latest data, the ongoing upward trend in security purchases by commercial banks continues to bolster overall liquidity; a positive sign for market stability.

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Current market sentiment suggests that many traders believe the bull market is over; however, if the primary liquidity drivers continue to pump, we can expect the market to respond in kind, reigniting bullish tendencies.

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Our AE Liquidity Index now stands at $127.078T, reflecting a 0.39% increase since our last update. Notably, the AE Rate of Change (RoC) has shifted into negative territory, signaling a critical turning point that investors should watch closely.