'Note ban to have minimal negative effect on rising deposits'

With over 80 per cent of the banned notes as of December 10 getting into the system as bank deposits, British brokerage HSBC has opined that the negative wealth shock may not be too high as originally feared.

While effective currency in circulation has fallen 60 per cent since demonetisation, showing a significant cash crunch, on the other hand 80 per cent of outstanding cancelled notes have made their way back to banks already, suggesting that the negative wealth shock may not be too high, HSBC India chief economist Pranjul Bhandari said in a note today.