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Venezuela is again cutting zeros on its banknotes, this time with six

Venezuela is again cutting zeros on its banknotes, this time with six

Once again, Venezuela is about to remove zeros from the national currency to simplify everyday transactions that sometimes no longer fit the calculator or require the use of the card several times to complete a purchase.

The central bank plans to cut up to six zeros from banknotes as early as August, when the previous issuance of banknotes with a higher face value did not solve the problems caused by hyperinflation. This was stated by Bloomberg, referring to three informed sources.

The removal of zeros means that one dollar (21.5 CZK) will now correspond to the value of 3.2 bolivars instead of the current 3.219 million bolivars.

Venezuela It last changed the value of the bolivar in 2018. In March, it began printing a banknote worth one million bolivars, which became the largest banknote in the country’s history. However, this note is now only 0.32 US cents which is not enough to even buy a cup of coffee.

Since 2008, for the first time under the presidency Hugo Chavez Then the current president, Nicolas Maduro, the country has already removed eight zeros from its currency due to hyperinflation.

The country unofficially adopted the US dollar for many daily transactions. However, most Venezuelans earn only bolivars.

The change was mainly requested by companies. They warned the government that things like paying taxes and other accounting processes had become unreasonably complicated for them.

The Central Bank of Venezuela does not publish regular data on inflation. According to the Café con leche index created by Bloomberg, which monitors the evolution of prices for coffee with milk in a bakery in Caracas, inflation is now 2339%. It has fallen from more than 300,000 percent in 2019. Compared to the previous month in May, prices rose by 20 percent.

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The Venezuelan economy may have reached its lowest point, preceded by seven years of economic decline. During that time, the local currency has become nearly worthless due to low oil prices and uncontrolled government spending. Under pressure from US sanctions, the government has had to remove control of some prices, cut subsidies on goods, including gasoline, and scrap many foreign exchange restrictions, which could allow the country to return to growth this year.

Video: 2019 in Venezuela. People without electricity, there are queues for water.

Venezuelans are powerless. Water queues here. Video: Associated Press, Reuters