JEDDAH — Liquidity in the Saudi economy recorded its highest levels ever at the end of last week, Aug. 20, reaching SR2.04 trillion compared to SR2.021 trillion at the end of the previous week Aug. 13.
The Saudi Arabian Monetary Authority (SAMA) data showed that the money supply increased by 0.93 percent during the past week, compared to the previous week, and 2.74 percent since the end of last year when it was SR1.985 trillion, according to Al-Eqtisadiah Arabic daily.
Since the week ending on May 7, 16 weeks, the money supply remained higher than SR2 trillion, reaching a record level at the end of last week, while the record level before it was SR2.035 trillion, achieved by the end of the week ending on July 30.
Increasing the money supply and lowering interest rates contributes to an "expansionary monetary policy", to boost overall demand, which supports GDP and employment, and is a useful policy to curb unemployment and the economic downturn, which is expected to prolong in most parts of the world with the corona pandemic.
In early June, SAMA announced the injection of SR50 billion to support liquidity in the banking sector and enable it to continue financing the private sector.
SAMA said that this liquidity will enhance the role of banks in adjusting or restructuring their finances without any additional fees, and support plans to maintain employment levels in the private sector, in addition to exempting a number of fees for electronic banking services.
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