CARACAS: In a portend of steepening inflation in crisis-stricken Venezuela, money supply surged 10% in just one week earlier this month, its largest single-week rise in a quarter of a century. Venezuela is undergoing a major economic crisis, with millions suffering food shortages, monthly wages worth only the tens of US dollars, and soaring inflation — though no official data is available. The central bank said late on Friday the total amount of local currency in circulation — known as M2 by economists – as of July 21 was 27.3 trillion bolivars, up 9.66% from the previous week. In October 1992, the figure rose 10.84% in a single week. The exponential rise in M2, the sum of cash, together with checking, savings, and other deposits, means an exponential rise in the amount of currency circulating. Venezuela’s money supply is up 384% in the last year.
Published in The Express Tribune, July 30th, 2017.