Venezuelan hyperinflation leads to new currency
- Published: Apr 9, 2018, 4 AM
As Venezuela’s economic mess continues unabated, with inflation surpassing 2,600 percent in 2017, the country’s president, Nicolás Maduro, decided on March 22 to make its worthless currency officially worthless. The currency now used has been in circulation for less than 10 years.
New coins and paper money will start circulating on June 4, at which point all existing currency will lose its value.
The new currency, called the “bolívar soberano” (sovereign bolivar, which will be written as “Bs.S.”), will actually come into existence on May 1, when three zeroes will be lopped off every denomination. For instance, the old 50,000-bolivar (Bs) note will be replaced by the 50-bolivar-soberano note. The old money will therefore continue in circulation for about another month.
The eight new denominations will be Bs.S 2, Bs.S 5, Bs.S 10, Bs.S 20, Bs.S 50, Bs.S 100, Bs.S 200 and Bs.S 500. The nation will also release 50-céntimo and Bs.S-1 coins.
According to Reuters, since Maduro came to power in April 2013, the bolivar has fallen 99.99 percent against the U.S. dollar on the black market, and if inflation continues at its current rate, another re-denomination will be necessary in 20 months. Maduro blames these problems on domestic opposition and the United States.
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