FedCash® Services: 2021 Holiday Currency Ordering Periods Suspended
The Federal Reserve will suspend the holiday currency ordering periods in 2021 as a proactive measure to reduce the operational strain on the cash supply chain during the winter holiday season as ongoing risks associated with the pandemic continue to create unprecedented challenges. Reserve Banks have paid out high amounts of new currency over the past 18 months, substantially increasing the number of new notes received by depository institutions. These factors all contributed to the decision to suspend the special holiday ordering periods again in 2021. While the Federal Reserve and cash supply chain continue to address operational challenges associated with the COVID-19 pandemic, the Federal Reserve Banks have sufficient currency reserves to meet the needs of depository institutions.
Reserve Banks are focusing on meeting daily demand for currency and coin during the COVID-19 pandemic
While Reserve Banks have traditionally provided holiday currency ordering periods on an annual basis, the suspension of the holiday currency ordering periods this year will enable Reserve Banks to continue focusing on their core mission of meeting daily demand for currency and coin.
Reserve Banks continue to pay out large amounts of new currency
Throughout the COVID-19 pandemic, demand for currency has been significantly higher than in more normal times, and Reserve Banks have paid out higher amounts of currency. Over the course of the last 18 months, Reserve Banks supplemented large portions of currency payouts with new notes to meet this demand. As a result, depository institutions received high volumes of new notes in all denominations. The significant increase in new notes paid out into the market contributed to the decision to suspend the holiday currency order.
Background on holiday currency ordering
To operate efficiently and minimize printing costs for new currency, Federal Reserve Banks generally fill orders for currency with fit notes first and then with newly printed notes. Prior to the COVID-19 pandemic, the Federal Reserve has offered two separate, week-long periods, in advance of the winter holiday season, when depository institutions can place special orders for new currency, in addition to their regular currency orders, which are filled with fit notes. The Reserve Banks have historically offered these special ordering periods because depository institutions typically receive a relatively small amount of new currency in their orders throughout the year. We will reassess the holiday currency ordering periods again in 2022 and communicate any changes.
For questions related to this change, please contact your local cash services department. If you know of others in your organization that should be notified of these types of operational changes, please share this article.