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Money in Circulation Surge
News:
- The uncertainty caused by the COVID-19 pandemic has led to a surge in currency in circulation.
- People are hoarding cash or parking money in accessible deposits to safeguard themselves against salary cuts or job losses.
More in the news:
- A rise in money supply usually is seen as a leading indicator of growth in consumption and business investments.
- Gross capital formation, or total investments toward fixed capital, fell 7% in the March quarter, a seven-year low.
- Lenders too are unwilling to take risks as slowing discretionary spending slows demand for manufactured and industrial goods.