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Venezuelan inflation rate could hit 2,000 percent by end of year

December 28, 2017

The Venezualan economy is in dire straits as the South American nation's currency — the bolivar — has weakened more than 97 percent against the dollar. Just as an example, 100 bolivars is now worth about $10 USD. As a result, Reuters reports it's been a tough holiday there, with some Venezualans resorting to hanging bolivars on Christmas trees since their value is nearly worthless. 

Additionally, merchants there are demanding payment in dollars which are typically nearly impossible for the nation's residents to even access due to strict exchange controls. Likewise, since residents are generally paid in bolivars, the exchange rate would result in a nearly worthless result for most Venezualans.

Reuters also reports that now a thriving black market in hard currency is thriving and merchants now demand either dollars or a black market equivalent that typically puts everything from medical care and supplies, to food and gas, out of reach for most residents. 

Venezuala's opposition-led National Assembly has said that a steep November rise in prices exceeded traditional hyperinflation benchmarks of more than 50 percent a month. As a result, Reuters reports that the country's inflation rate could end 2017 at an astounding 2,000 percent.