Publications on Banknotes & coins
- 22 March 2021
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 2, 2021Details
- Abstract
- What explains the strong growth of euro banknote demand, given that the transactional use of banknotes seems to have decreased? Key to explaining this phenomenon – referred to as the “paradox of banknotes” – is acknowledgement of the importance of all three components of banknote demand: euro area transactional demand, euro area store-of-value demand and foreign demand. This article explains these components and estimates their relative size. It also addresses COVID-19-related banknote developments during 2020, highlighting the importance of cash during crises.
- JEL Code
- E41 : Macroeconomics and Monetary Economics→Money and Interest Rates→Demand for Money
E51 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Money Supply, Credit, Money Multipliers
E58 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Central Banks and Their Policies
- 2 December 2020
- OTHER PUBLICATIONDetails
- Network
- Eurosystem Research Network on Cash (EURECA)
Annexes- 2 December 2020
- OTHER PUBLICATION
- 2 December 2020
- ANNEX
Related- 2 December 2020
- PRESS RELEASEEnglishOTHER LANGUAGES (14) +
- 24 September 2018
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 6, 2018Details
- Abstract
- This article presents the developments in the circulation of euro banknotes and the underlying drivers of cash demand in the euro area and abroad. Cash in circulation is on the rise, both in the euro area and abroad. In addition, data from a survey on the use of cash in the euro area indicates that by volume and number of transactions cash remained the most used payment instrument in 2016. However, the growth in banknote circulation can only partially be explained by transaction demand. Most euro banknotes in circulation are used as a store of value and households and firms inside and outside of the euro area obviously value the option of storing part of their assets in central bank money. Considering the currently low opportunity costs of holding cash, the stored euro banknotes can be expected to return if interest rates were to increase. However, as shown by developments over the past ten years, the store of value function is determined not only by interest rates, but also by external events which cannot be predicted. The demand for banknotes has also been impacted by various additional factors such as the financial and sovereign debt crises, geopolitical uncertainties, exchange rate developments and policy decisions
- JEL Code
- D12 : Microeconomics→Household Behavior and Family Economics→Consumer Economics: Empirical Analysis
E41 : Macroeconomics and Monetary Economics→Money and Interest Rates→Demand for Money
E42 : Macroeconomics and Monetary Economics→Money and Interest Rates→Monetary Systems, Standards, Regimes, Government and the Monetary System, Payment Systems - Network
- Eurosystem Research Network on Cash (EURECA)
- 20 September 2017
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 06, 2017
- 23 July 2015
- OTHER PUBLICATIONRelated
- 23 July 2015
- PRESS RELEASEEnglishOTHER LANGUAGES (22) +
- 26 March 2015
- OTHER PUBLICATION
- 14 April 2011
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 4, 2011
- 21 April 2009
- OTHER PUBLICATION
- 21 April 2009
- OTHER PUBLICATION
- 29 May 2008
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 5, 2008
- 21 April 2008
- OTHER PUBLICATION
- 21 April 2008
- OTHER PUBLICATION
- 11 October 2007
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 10, 2007
- 23 April 2007
- OTHER PUBLICATION
- 23 April 2007
- OTHER PUBLICATION
- 12 April 2007
- OTHER PUBLICATIONEnglishOTHER LANGUAGES (20) +
- 21 December 2006
- OTHER PUBLICATIONEnglishOTHER LANGUAGES (21) +
- 7 August 2006
- OTHER PUBLICATIONEnglishOTHER LANGUAGES (21) +
- 25 April 2006
- OTHER PUBLICATION
- 13 January 2006
- OTHER PUBLICATIONEnglishOTHER LANGUAGES (21) +
- 11 August 2005
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 8, 2005
- 26 April 2005
- OTHER PUBLICATION
- 6 January 2005
- OTHER PUBLICATIONEnglishOTHER LANGUAGES (21) +Related
- 6 January 2005
- PRESS RELEASEEnglishOTHER LANGUAGES (19) +
- 12 August 2004
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 8, 2004
- 27 April 2004
- OTHER PUBLICATION
- 1 September 2003
- OTHER PUBLICATION
- 17 July 2003
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 7, 2003
- 10 April 2003
- OTHER PUBLICATION
- 23 January 2003
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 1, 2003
- 29 October 2002
- OTHER PUBLICATION
- 30 June 2002
- OTHER PUBLICATION
- 24 May 2002
- OTHER PUBLICATION
- 9 May 2002
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 5, 2002
- 10 April 2002
- OTHER PUBLICATIONRelated
- 24 April 2002
- PRESS RELEASE
- 1 April 2002
- OTHER PUBLICATION
- 24 January 2002
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 1, 2002
- 18 October 2001
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 10, 2001
- 1 May 2001
- OTHER PUBLICATION
- 19 April 2001
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 4, 2001
- 1 April 2000
- OTHER PUBLICATION
- 9 November 1999
- OTHER PUBLICATIONRelated
- 9 November 1999
- PRESS RELEASE
- 1 April 1999
- OTHER PUBLICATION