Global Liquidity Updates

Global liquidity has increased from $127.08T to $127.9T, marking a significant $0.81T rise (+0.64%) this past week. Despite the 3M remaining under the 12M ROC, indicating a bearish signal, the overall liquidity surge can't be ignored.

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China has also injected liquidity with $19.39B, $8.67B, and $95.9M, contributing to broader market movements.

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Looking ahead, the upcoming FOMC meeting on Sept 17-18 is highly likely to result in a starting rate cutting cycle.

This week's liquidity heatmap highlights increasingly positive signs of easing.

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The Eurozone, one of the Big 5, is anticipated to make another interest rate cut on September 12th, its first since June. This precedes the crucial FOMC meeting set for the 18th.

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We are now witnessing the easing cycle swing into full gear.

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.