In 2020, the value of cash in circulation increased by 34.8 percent, or PLN 83 billion, compared to 2019, the National Bank of Poland reported. In the published report, the central bank also added that this is a record annual increase.
“It is worth emphasizing that the annual increase in the value of circulation in 2019 compared to 2020 was four times lower” – wrote in the published “Report on cash turnover in Poland in 2020”, prepared by the National Bank of Poland.
More cash in circulation – NBP data for 2020
As indicated, the phenomenon of the increase in cash in circulation in 2020 resulted not only from the increase in the level of withdrawals of the Polish currency from the NBP, but also from a much lower level of its transfers to the NBP. The central bank announced that the value of banknotes and coins collected from the NBP in 2020 amounted to PLN 222.8 billion and increased by 9.5%. compared to the previous year, while the value of banknotes and coins returned to NBP in 2019 amounted to PLN 139.8 billion and decreased by 24.1%. compared to the previous year.
“The increase in the value of Polish currency downloads from NBP was particularly noticeable in the period March-April 2020 (the record level of PLN 6 billion was reached on March 13, 2020) and at the turn of October and November 2020.” – stated in the report.
On March 4, the first case of COVID-19 was found in Poland. First death of a person infected with coronavirus confirmed in Poland on March 12. In the fall of 2020, there was a second wave of the pandemic.
Increase in the value of currency in circulation
The NBP pointed out that in Poland the increase in the value of currency in circulation has been observed for years. In the last decade, ie in 2011–2020, the value of currency in circulation increased threefold compared to December 2010, from PLN 102.7 billion to PLN 321.5 billion. However, the year 2020 was exceptional in this respect.
“The trends in the value of notes and coin in circulation, resulting from the previously identified factors of a fundamental (e.g. exchange rate, GDP, inflation, interest rates) or seasonal (holidays, holidays, the beginning of the school year, etc.) significantly disturbed by the impact of the COVID-19 pandemic “- assessed in the report.
Demand for cash
The NBP calculated that in 2020 the ratio of the value of cash circulation to GDP was 13.8%. and was much higher than in 2019 (10.4%), which is the largest increase in the last decade.
“In the face of unprecedented demand for cash, the NBP met the market challenges, ensuring efficient and uninterrupted supply of Polish currency to banks. The central bank strengthened its cooperation with banks, CIT companies and manufacturers of notes and coin, and successfully adapted the organization of work to meet the demand for money. cash “- stated in the report.
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