"Liquidity conditions" refers to the availability of liquid or easily accessible funds in an economy or financial system. It describes the ease with which individuals, businesses, and banks are able to obtain cash or convert assets into cash. When
liquidity conditions are favorable, there is sufficient money circulating in the system, lending and borrowing facilities are readily available, and financial transactions can be carried out smoothly. On the contrary, when
liquidity conditions are tight or adverse, it becomes more challenging and expensive for individuals or entities to access funds, potentially resulting in economic slowdown or financial strain.
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