India's cash in circulation hits record ₹42.3L/cr, nearly 12% higher
Business
India's cash in circulation just hit a new record: ₹42.3 lakh crore as of mid-April, up nearly 12% from last year.
That's the biggest jump since demonetization days in 2017.
Economists say this much cash floating around could make it trickier for banks to manage their funds in the coming months.
Rural spending, GST cut boost cash
The spike comes from strong rural spending and a GST cut on essentials in September, which made people use more cash for everyday purchases.
Lower interest rates mean folks in rural areas prefer paying with cash, and with gold and silver prices rising, households are recycling gold and silver for extra money.
RBI may struggle with liquidity
With so much money out there, the Reserve Bank of India might have a tougher time keeping banking system liquidity balanced.