What can biology tell us about transaction balances?

The total cash issuance of a central bank consists of domestic transaction and hoarding balances as well as foreign demand. The different shares are not known exactly. The introduction of the new Europa series of banknotes in the euro area offers the opportunity to calculate transaction balances with the help of a biometric method. Our results indicate that transaction balances are very low.     

Currency movements within and outside a currency union: The case of Germany and the euro area

In this paper, we analyse the volume of euro banknotes issued by Germany within the euro area with several seasonal methods. We draw a distinction between movements within Germany, circulation outside Germany but within the euro area and demand from non-euro-area countries. Our approach suggests that only about 20% of euro notes issued by Germany are used for transactions in Germany. The rest is hoarded (10%), circulates in other euro area countries (25%) or is held outside the euro area (45%).