Net Liquidity (Fed BS − TGA − RRP)
What is Net Liquidity (Fed BS − TGA − RRP)?
Net Liquidity is the Fed balance sheet minus the Treasury General Account (TGA) and the overnight Reverse Repo Facility (RRP). It approximates the dollar reserves actually available to the banking system and to risk markets.
Why it matters
Net Liquidity has tracked S&P 500 levels with a lag of roughly two to six weeks across the post-2020 regime. Rising net liquidity historically supports risk assets; sustained drawdowns are a leading indicator of equity drawdowns and spread widening.
How to read prints
When it rises
Bank reserves expanding; supportive of risk assets and tighter credit spreads.
When it falls
Bank reserves draining; pressures risk assets and widens credit spreads.
Frequently asked
What is Net Liquidity?⌄
Why subtract TGA and RRP?⌄
What is the lag versus the S&P 500?⌄
How is this different from M2?⌄
Track it on Market Ontology
Monitor Net Liquidity (Fed BS − TGA − RRP) in real time on Liquidity Regime, alongside regime classification, transmission mapping, and cross-asset context.
| Source | Calculated (Federal Reserve) |
| Frequency | Weekly |
| Category | Liquidity |
| FRED Series | WALCL |
| Unit | USD bn |
| Related Module | Liquidity Regime |
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Track Net Liquidity (Fed BS − TGA − RRP) in real time
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