The world is awash with cash. That's why asset prices keep rising

If most financial markets seem immune to bad news, there may be a simple reason: the world is awash with cash.

New Commonwealth Bank Economic research shows that global monetary liquidity remains abundant in 2026, creating a powerful tailwind for shares and other financial assets.

The research, from CBA Fixed Income & Interest Rate Strategist Dr Hamid Yahyaei, introduces a new Global Monetary Liquidity index that combines data from 150 countries, tracking both private-sector lending and broad money balances, such as bank deposits. The result paints a clear picture: when money is plentiful, asset prices tend to rise. When liquidity dries up, markets struggle.

"Liquidity is the lifeblood of financial markets and the degree to which it is abundant or scarce has important implications for asset prices," Dr Yahyaei explains.