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.
The stock market stabilized on Thursday after the central bank injected liquidity into the financial system, placed the troubled funds under the control of banks and announced plans to dissolve them.
From The Wall Street Journal ● Sep. 18, 2026
A sudden liquidity panic, the kind that felled Lehman Brothers, he noted, is something Beijing can nearly always head off.
From The Wall Street Journal ● Sep. 15, 2026
Faced with rising yields, Bessent last month made the surprise announcement that he would at least double buybacks of longer-term Treasurys, expanding a program that was originally intended to improve liquidity in older, off-the-run securities.
From The Wall Street Journal ● Sep. 10, 2026
They listed possible rate hikes, geopolitical uncertainty, the upcoming midterm elections and increasing liquidity needs from initial-public offerings and hyperscaler funding as concerns from investors.
From MarketWatch ● Sep. 9, 2026
When an executive said his bank had plenty of liquidity it always meant that it didn’t.
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.
