The US Federal Reserve Prints Record Number of $50 Bills as Demand for Physical Cash Rises
The Bureau of Engraving and Printing, responsible for money printing in the US, has created a whopping 756.09 million new $50 bills in 2022, worth approximately $37.8 billion. The surge in printing is attributed to the increased demand for physical cash in the country, despite a decline in cash usage for payments.
Rise in Demand for Cash Amid Economic Uncertainty
According to the San Francisco Fed’s Diary survey, which analyzes consumer payment habits, the demand for physical cash is likely driven by economic uncertainty following the pandemic. Although the average number of cash payments remains below pre-pandemic levels, the overall demand for cash has continued to grow. The value of currency in circulation surpassed $2.23 trillion as of October 2022, a 28% increase compared to February 2020.
Preference for Cash Persists Despite Electronic Payments
The survey also reveals that despite the growing preference for electronic payments, 93% of respondents expressed no intention to stop using cash. This paradox between increased credit card usage and the demand for physical cash indicates that the desire for cash remains strong.
Continued Investment Needed to Ensure Cash Access
The report emphasizes the importance of ongoing investment across the supply chain to ensure access to cash for those who prefer or need it. While some consumers may eventually transition away from using cash, the underlying demand suggests that cash will remain an important payment instrument.
Hot Take: Americans’ Persistent Demand for Physical Cash Defies Digital Trends
Despite the rise of digital payments and credit card usage, Americans are hoarding physical cash at an unprecedented rate. The US Federal Reserve has printed a record number of $50 bills, worth billions of dollars, to meet this demand. This surge in demand for cash is believed to be driven by economic uncertainty following the pandemic. Surprisingly, despite the convenience of electronic payments, a vast majority of consumers have no intention of abandoning cash. This trend highlights the enduring appeal and trust placed in physical currency, emphasizing the need for continued investment to ensure access to cash for those who rely on it.
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