liquidity
Americannoun
-
the possession of sufficient liquid assets to discharge current liabilities
-
the state or quality of being liquid
Etymology
Origin of liquidity
From the Latin word liquiditās, dating back to 1610–20. See liquid, -ity
Explanation
Liquidity refers to a state where something is in liquid form, like water. It can also refer to having cash or access to cash. Liquidity means things are flowing. Although liquidity refers to…surprise! being a liquid, it’s usually used in a financial sense. Financially, liquidity refers to having access to cash or things you can sell and turn into cash. In other words, you have good cash flow. Liquidity can also apply to any situation that is marked by fluidity or runniness. You hope your new swimming pool is in a state of liquidity, and that you have enough financial liquidity to pay for it!
Vocabulary lists containing liquidity
Personal Finance and Financial Literacy - High School
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Economics
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Personal Finance and Financial Literacy - Middle School
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Example Sentences
Examples are provided to illustrate real-world usage of words in context. Any opinions expressed do not reflect the views of Dictionary.com.
Walter, the billionaire founder of Guggenheim Partners, is facing a federal investigation at his firm into private credit lending, and a liquidity crunch.
From The Wall Street Journal ● Aug. 15, 2026
While European liquidity broadly follows American trends, there is one sphere in which the liquidity cycle differs markedly: China, which is also travelling in the opposite direction, according to Howell.
From MarketWatch ● Aug. 14, 2026
Howell’s chart shows how global liquidity is on a weakening trend and he forecasts that interest rates will rise, it’s simply a question of when.
From MarketWatch ● Aug. 14, 2026
The chief executive of Guggenheim Partners needed liquidity to keep his insurance companies afloat, people familiar with the matter said.
From The Wall Street Journal ● Aug. 13, 2026
To which Vinny replied, “The way we thought about it, which we didn’t like, was, ‘By shorting this market we’re creating the liquidity to keep the market going.’”
From "The Big Short" by Michael Lewis
Definitions and idiom definitions from Dictionary.com Unabridged, based on the Random House Unabridged Dictionary, © Random House, Inc. 2023
Idioms from The American Heritage® Idioms Dictionary copyright © 2002, 2001, 1995 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company.
