India's currency in circulation reaches record ₹42.3 lakh crore

7 articles · Updated · NewsBytes · May 5

It rose by more than ₹61,000 crore in the first half of April, up 11.8% year on year and the highest level since early 2017 after demonetisation.
Economists warned the sustained six-month rise in cash demand could tighten banking liquidity, with HDFC Bank forecasting liquidity surplus averaging about 1% of deposits in the first half of the fiscal year.
Analysts at ICICI Securities and SBI linked the increase to rural demand, GST cuts on essential goods, lower interest rates and high precious metal prices encouraging household gold and silver recycling.

Is India's rural economy driving a cash surge that could trigger a nationwide banking liquidity crisis?

Is a tax crackdown unintentionally pushing small traders back to cash, reviving India's shadow economy?