C1nounformalmoneybusiness
US/lɪˈkwɪd.ə.ti/
UK/lɪˈkwɪd.ə.ti/
how easily a person or company can turn assets into cash or pay short-term debts
In context
The bank had enough liquidity to survive the sudden rush of withdrawals.
Small firms often face liquidity problems when customers pay late.
Investors prefer stocks with high liquidity because they are easy to sell.
Words that go with liquidity
noun + noun
- liquidity crisisThe company collapsed in a liquidity crisis.
- liquidity problemsLiquidity problems forced the shop to close.
- liquidity riskManagers must watch liquidity risk every week.
adjective + noun
- high liquidityGold offers high liquidity in most markets.
verb + noun
- inject liquidityCentral banks injected liquidity into the market.
- lack liquiditySome assets lack liquidity and take months to sell.
Common mistakes
Incorrect:
the liquid of the companyCorrect: the liquidity of the company