Inflation is a very problematic financial situation which is often underestimated. Anyone who never had to deal with such a problem can’t fully grasp the consequences. In the case of Venezuela, things continue to grow progressively worse. The country is dealing with an inflation rate of 62.5, which is absolutely mind-boggling.
Venezuelan Crisis Isn’t Over
For numerous year snow, the financial situation in Venezuela has become unstable. Even a change in the presidency has not offered much relief to the struggling nation. Its inflation rate is well-documented, yet it seems there is no way to turn the downward slope into a status quo. An interesting, albeit extremely worrisome situation has been created because of this.
New reports by the National Assembly aren’t helping much either in this regard. In August of 2019, Venezuela’s inflation rate hit a high of 62.5%. It is also the second time the monthly inflation rate is higher than 50% in 2019. Turning this situation around is crucial, yet it seems no viable solution is accessible at this time. Nor will there be any positive changes for quite some time to come.
Hyperinflation Isn’t Ending
Earlier this year, there were some individuals who claimed Venezuela’s economy would exit the hyperinflation status and simply enter “regular inflation”. By the sound of it, that wouldn’t make much of a difference, but one has to start somewhere. Unfortunately for this country, one needs 12 consecutive months with inflation rates below 50% to escape the “hyper” term. So far, the country failed to note such a trend.
To make matters worse, there is no real indication that the current economic policy in the country will help turn the ship around. Instead, it seems as if the government is more than happy to leave things be as they are today. Even if that means there will be even more inflation in the future, there will seemingly be no intervention to take note of. Additionally. Venezuela is currently in the top 12 countries with the longest hyperinflation trend in history.
What Comes Next?
Recovering from inflation itself is difficult enough. Dealing with multiple hyperinflation spikes every year is virtually impossible. There doesn’t appear to be any recourse as far as Venezuela is concerned, regardless of what the government or central bank may attempt. As a result, the inhabitants of this country will continue to struggle to make ends meet. No viable solution exists to end this vicious cycle, which will undoubtedly have consequences for the global economy as well.