The IMF recently calculated Venezuela’s inflation to be 275%, the highest in the world. And that isn’t the worst of it. Researchers predict that inflation will reach 720% in 2016 and GDP will crash by almost 20%.
To get a better handle of what that means for Venezuelan life, I’d recommend following Nick Casey, a New York Times correspondent who is chronicling his first 30 days living in Caracas. Here is a recent tweet of his:
He also has a good blog post called “A Bank Robbery? Nope, Just Buying Coffee and Groceries in Caracas.” In it, he describes the daily joys of living in a country with hyperinflation. Here he is writing about his trip to the coffee shop:
“According to the government, the official exchange rate is 6.3 bolivars to the dollar. But the market doesn’t accept that. On the streets, a money changer will be happy to buy your dollars for 700 bolivars a piece. Here is the magic realism of Caracas. Those coffees from Tuesday? They cost 2,200 bolivars. On the black market, that’s $3. At the official exchange, $349.”
Paying for everyday items is even more of a pain because the government has refused to print bills greater than 50s and 100s, which “trade for nickels and dimes.” (note: what is up with the dude’s glasses on the 50 bolivar note? I wonder if he bemoaned the fact that his glasses didn’t help his eyesight at all)