Cash and COVID-19: The Effects of Lifting Containment Measures on Cash Demand and Use

Heng Chen, Walter Engert, Kim Huynh, Gradon Nicholls and Julia Zhu

No 2021-3, Discussion Papers from Bank of Canada

Abstract: We conduct a follow-up to Chen et al. (2020) and study demand for and use of cash after the containment measures imposed at the beginning of the COVID-19 pandemic were relaxed during the summer of 2020. We find that bank notes in circulation continued to rise in July due to ongoing cash withdrawals and decreased cash deposits in the Bank Note Distribution System. The probability of consumers using cash for payments increased in July compared with April 2020. As well, consumer cash holdings, measured as the median value of cash on hand, returned to August 2019 levels.

Keywords: Bank notes; Central bank research; Coronavirus disease (COVID-19); Digital currencies and fintech; Econometric and statistical methods (search for similar items in EconPapers)
JEL-codes: C12 C9 E4 O5 O54 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2021-03
New Economics Papers: this item is included in nep-mac, nep-mon and nep-pay
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Citations: View citations in EconPapers (12)

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