Currency in Circulation: Pre and Post Demonetisation trends

There have been comments in social media how currency in circulation is back to pre-demonetisation levels.

So, just downloaded data and plotted it.Yes, indeed!







Currency in circulation was Rs 17977 billion on 4 Nov 16 and then declined to touch Rs 8980.2 billion by 6 Jan 17. It has been rising ever since and crossed the pre-demonetisation levels recently and touched Rs 18135.52 on 9-Mar-18.

I have also plotted a linear trend to see how much the levels would have been if there was no demonetisation. The currency levels would be around Rs 21 billion. What is also interesting is how the gap between the potential currency levels (dotted blue line) and the actual currency levels (orange line ) is reducing overtime. If one just extrapolates current trends, the actual currency levels will equal the potential currency levels by end of Oct-2018….


4 Responses to “Currency in Circulation: Pre and Post Demonetisation trends”

  1. harish ram Says:

    I would disagree on the timeline for the gap to close. Indian currency over the last 15 years follows a Sept~May period of growth and retraction in the remaining months. So it mostly will stagnate or at worse reduce till sept’18 and then pick up the pace. So considering the retraction and then growth in the middle of 2018, my guess is the real growth will cross the projected line by end of 2018 or beginning of 2019.

    Anyway, if we consider Yr 2016, the year without retraction, as the basis, your prediction can come true, also aided by the fact that it’s the election year.

    My research:

  2. kirti sharma Says:

    Hello, I am doing Ph.D. And I want to use this ‘Currency in Circulation: Pre and Post Demonetisation trends’ graphical image in my research paper, for this I want permission from the author. Can anyone help regarding this issue.

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