Global Liquidity Index (GLI) August 2014 Update

by Michael J. Howell9. August 2014 11:44
The GLI (Global Liquidity) leading index of international capital and liquidity movements was slightly higher in July 2014 at 45.8 ('normal' range 0-100), from 44.6 in June. Developed economies have much stronger liquidity at a 62.5 index level, than Emerging Markets at 16.7. Headline global liquidity conditions are broadly unchanged over the past four months and remain a tad below average, but this disguises two major undercurrents: (1) there is an on-going switch in the direction of capital flows from Developed to Emerging Markets, even despite the fact that capital is again, as we write, quitting Russia; and (2) private sector liquidity is either weak or weakening, and Central Bank liquidity is either generally firm or strengthening.

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