Record Global Liquidity Meets “Higher for Longer” Rates

[mendez]

At the same time liquidity is surging, policymakers remain cautious. Recent meeting minutes show officials committed to holding rates higher for longer unless inflation clearly weakens, pushing expectations for meaningful cuts well into the future — even as global liquidity has climbed by nearly $500 billion.

Historically, expanding liquidity has fueled risk assets, including crypto markets, but this cycle looks different. Bitcoin remains range-bound, suggesting that restrictive rates, regulation, and post-volatility caution are offsetting liquidity tailwinds. Whether December’s surge marks a true turning point may depend less on what the Fed calls its actions — and more on how long this quiet flow of liquidity continues.

[chainsniff]

liquidity up but rates still high is such a weird combo for markets