What drives the demand for large banknotes in Switzerland?
Résumé
In contrast to what one might believe, the demand for banknotes has remained strong in recent years in most advanced economies despite continuing innovation in payment technologies. This Economic Note highlights the importance of the store-of-value motive for holding banknotes. The motive is reflected in the importance of the opportunity cost - the level of interest rates - to explain the demand for large-denomination banknotes in Switzerland.
- Issue:
- 01
- Pages:
- 5
- Keywords:
- Currency in circulation, Cash, Demand for banknotes
- Year:
- 2024