The See Central bank. of Australia’s (RBA) March 2018 Bulletin tries to understand growing demand for high-denomination banknotes in Australia, Canada and the United Kingdom. Indeed, demand for these countries’ currencies has been growing overall, but have reached a 50-year peak for the highest denominations: the AUD 100, CAD 100 and the GBP 50.
RBA’s research tackles various hypotheses including the correlation between financial uncertainty and the The term refers to the use of cash as a store of value. However, the term has a negative connotation of concealment, and is often used in the context of the war on cash. See Precautionary Holdings. of Money in physical form such as banknotes and coins., overseas demand for foreign The money used in a particular country at a particular time, like dollar, yen, euro, etc., consisting of banknotes and coins, that does not require endorsement as a medium of exchange. as well as the effect of government and central bank policies on withdrawals of high denominations.
There are indeed other variables that could come into play such as the grey economy. Nevertheless, given the limited data on the subject, it was not be taken into consideration in the report.
The study found that demand for high-denominations is greatly linked to three major points:
To read the full RBA March 2018 Bulletin, please click here.