The July 2020 Monthly Report looks at the German current account surplus through the lens of macroeconomic models and examines the extent to which German households store cash, as well as their reasons for doing so.

Estimates by the Bundesbank suggest that banknotes worth around €268 billion were in circulation in Germany in 2018. Of that amount, roughly 20% was used directly for transactions. The other, far larger share – somewhere in the region of €200 billion – was being hoarded, i.e. stored for an extended period of time by households and firms.