Households withdrew up to $4 billion in cash from banks in September and October last year as the global financial crisis worsened, according to a Reserve Bank report.
The Reserve Bank’s annual report released yesterday revealed that at the peak of the global financial crisis, the desperate hoarding of money threatened to exhaust the Reserve Bank’s stocks of $50 and $100 notes and it had to print more to meet the demand.
“The Reserve Bank responded to a surge in demand for banknotes around the time of the global banking crisis, as some depositors withdrew cash from banks,” Governor Glenn Stevens wrote in his foreword to the report.
The report also revealed that the number of banknotes in circulation normally rises by about 5 percent a year, but in the last three months of 2008 there was a 19 percent surge, lifting the total value of notes in circulation to more than $50 billion.
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