How Much Money is in the UK

How Much Money is in the UK?

The United Kingdom has the fifth-largest national economy in the world by nominal gross domestic product (GDP), representing 2.40% of the world economy. But, to know how much money is in the UK, you may have to find out exactly how much money is in circulation as a major factor when calculating how much money a country has.

 

The Bank of England has given a clue to the amount of currency in circulation to help you know how much money is in the UK. In this article, you will find the information.

How Much Money is in the UK?

One of the best ways to find out how much money is in the UK is to find out how much is in circulation. The Bank of England notes in circulation are over 4.5 billion, and when added they are worth about £80 billion. The total value of the UK notes in circulation tends to have increased by the £20 and £50 notes.

 

Currency in circulation refers to the amount of physical cash - paper notes or coins that a country uses to perform transactions. A country's currency in circulation is all of the money that its monetary authority has issued minus cash that has been removed from the system.

 

The money that has been removed from the system may include damaged money, counterfeit money, unfit money, etc. Each year the Bank of England destroys unfit banknotes and issues new ones to replace them and at the same time, ensure a sufficient supply of banknotes. For damaged notes, they receive thousands of claims each year for replacement.

 

It is a key factor in a country's economy because it is highly liquid - one of the most liquid asset classes. In fact, currency in circulation represents a good part of the overall money supply.

 

The Bank of England measures the growth of notes in circulation (NIC) yearly using two major approaches:

 

  • Peak-to-Peak

Peak-to Peak is a measure for the difference between the peak levels of NIC (usually running up to Christmas) yearly.

 

  • Average Year-on-Year

The average year-on-year measures the difference between the average level of NIC yearly.

What are the Pillars of the UK Economy?

The United Kingdom has the fifth-largest economy following the U.S., China, Japan, Germany, and India. The UK operates a reasonably diversified economy and certain sectors contribute a large chunk to their economy. These sectors include services, construction, manufacturing, and tourism

 

According to the Office for National Statistics (ONS) in the UK, the services sector is the UK's largest sector in the U.K. The service industry includes many consumer-focused industries, such as food and beverage, retail and entertainment, as well as finance and business services. This sector contributes much more than other sectors, making up over three-quarters of the GDP.

 

As of 2018, the services industry recorded additional growth of 2.1% which was a significant increase from the previous two years. Tourism is another major contributor to the U.K. According to ONS 2019 reports, resident visitors in the UK spent £28.4 billion or $35.9 billion on travel and tourism.

Bottom Line

The Bank of England has provided an answer to the question of how much money is in the UK as £80 billion. However, this amount is the total of all the money in circulation alone.