Venezuela launches new banknotes and increases denominations | International

Venezuela launches new 200 and 500 bolivar banknotesThe central bank announced on Friday that the notes are equivalent to $5.4 and $13.6 respectively, becoming the highest denominations in a country that has been hit by years of inflation and currency depreciation.

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“The two new banknotes will be incorporated into the current monetary cone (…). The new Bs. 200 and Bs. 500 will gradually come into circulation”the Central Bank of Venezuela (BCV) reported in a statement.

The country of 30 million inhabitants put the current series of coins and banknotes into circulation in October 2021, when For ease of operation, six zeros were removed from the Bolivar. This is the third remodel since 2008. In total, 14 zeros have been removed. One bolivar today is equivalent to 100 million bolivars in 2008.

In the economic crisis Leading more than 7 million Venezuelans to emigrateThe devaluation of the local currency has led to an informal process of dollarization, and the vast majority of bolivar transactions are done via debit cards or electronically, according to the United Nations. Cash is used to pay for small-scale transactions such as bus tickets.

However, despite renewed political tensions Opposition accuses Nicolás Maduro of fraud in re-election On July 28, price increases slowed down and the exchange rate stabilized.

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According to BCV data, Venezuela’s inflation rate was 1% in June and the annual inflation rate was 51.3%. It is still one of the highest in the worldbut inflation has been falling. After four years of hyperinflation, in 2023 the figure was 189.8%, while in 2022 it was 234% and in 2021 it was 686.4%. In 2018, at the height of the crisis, the figure reached 130,000%.

Meanwhile, after years of accelerating depreciation, the exchange rate has been around 37 bolivars to the dollar for several months.

government Maduro freezes minimum wage from 2022it has been diluted from the equivalent of $30 a month to less than $4, even though it has been applying the so-called supplemental bonus Comprehensive minimum income That’s about $130 per month.

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AFP