Value of Banknotes in Circulation
The value of banknotes in circulation is the total amount of currency put into circulation by the CBRT.
- Economic activity in the country,
- Wage and tax payments,
- Other lump sum payments or collection periods.
Banknote Printing Program
The CBRT prepares a Banknote Printing Program to arrange banknote printing in the upcoming years. The number of banknotes to be printed and circulated is determined taking into account the following factors:
- The level that the volume of banknotes is expected to reach at the end of the current year and in the next year depending on developments in macroeconomic indicators such as inflation, growth, exchange rates and interest rates,
- The auxiliary storage policy drawn up considering the highest level that the volume of currency in circulation is expected to reach, calculated taking into account holidays and wage payment periods,
- The amount of old, damaged or mutilated banknotes (ratio of worn-out banknotes).
Value of Banknotes by Denomination
An analysis of different studies and country cases on the amount of banknotes by denominations reveals that there is more than one scenario. For instance, when there are more than 6 or 7 denominations, some denominations may go out of use and when there are only a few denominations, there might be problems in cash payments.
Therefore, while deciding on the banknote composition by denominations, the CBRT takes into account other countries’ experiences and the factors below:
- Experiences in the past,
- Pricing policy of the retail sector,
- Coin utilization habits,
- Rounding effect.