2024 US liquidity remains on a mixed picture, but stable
Although bank reserves have begun to decline again in 2024, deposits, lending, and M2 are starting to experience positive year-over-year growth once again
FED Balance sheet, has decreased 1.064 Trillion in the last year (-534 B in 2024 as of July), a - 13% Y/Y, however rate of decline has decreased in the last two months with only a ~50 Billion decline (~600 B annu) since the FED decreased the amount of QT.
FED Net Liquidity (balance sheet -TGA - Reverse Repo) remains mostly flat since the end of 2022
- The reverse repo facility has been drained by about 585 billion in total in 2024 offsetting in the most part the FED QT, however, the pace of decline has slowed significantly in recent months.
After the surge in 2023 (+428 Billion), bank reserves has started to decrease again in 2024, falling by 132 Billion in total as of the end of August.
Most of the decline has happened after Q1 2024. Reserves are still 2.32 Y/Y.
M2 has increased 303 Billion as of July 2024 (1.25% Y/Y), after falling by 558 B in 2023.
