There has been a drop in circulation of Rs 2,000 notes: ET
Bankers speculate that this could be a deliberate strategy to limit the supply of the notes.
Eight months after demonetisation and the introduction of new currency notes, bankers feel there is now a drop in the circulation of Rs 2,000 notes, The Economic Times reported on Thursday.
The report added that the supply of Rs 2,000 notes from the Reserve Bank of India has declined recently, leading to speculation that this might be a deliberate plan to limit the supply of the notes.
State Bank of India’s Chief Operating Officer Neeraj Vyas was quoted as saying, “Presently we are receiving currency notes from the Reserve Bank in the denomination of Rs 500 in high-value currency... The Rs 2,000 denomination notes are coming over the counters by way of recirculation.” He added that areas in Andhra-Telangana, Patna and Kolkata were facing cash shortages.
While the RBI has not replied to these speculations, reports say the central bank has continued to pump in enough Rs 500 notes into ATMs to ensure there is no shortage of money in the market.
The Economic Times report also cited calculations by ATM operators, which showed that the number of Rs 2,000 notes in the market is higher than that of Rs 500 notes.
However, the report added the currency in circulation has not yet reached pre-demonetisation levels. Latest RBI data shows the currency in the market was Rs 14.5 lakh crore as of June 23, against the Rs 17 lakh crore before November. On November 8, 2016,the central government demonetised Rs 500 and Rs 1,000 notes, which had made up around 84% of the country’s liquidity at the time.