The air becomes solid water!
But seriously, it is just the max amount of water that the air can “absorb”. It is a relative number, and the physical amount will vary based on air temperature. So 10% humidity in cold air is not the same amount as 10% in hot air.
Basically if 100% humidity happens, than it is likely to rain. Keeping in mind that humidity also varies based on altitude as well, so if it is X amount humid at the surface, it means up high where it is colder, the % humidity is likely to be more, causing high potential for rain.
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