Last year, Nicholas Krus and I published a chapter, “World Hyperinflations”, in the Routledge Handbook of Major Events in Economic History. We documented 56 hyperinflations – cases in which monthly inflation rates exceeded 50% per month. Only seven of those hyperinflations have savaged Latin America (see the accompanying table).
At present, the world’s highest inflation resides in Latin America, namely in Venezuela. The Johns Hopkins – Cato Institute Troubled Currencies Project, which I direct, estimates that Venezuela’s implied annual inflation rate is 302%. Will Venezuela be the eighth country to join the Latin American Hall of Shame? Maybe. But, it has a long way to go.
The Hanke-Krus Hyperinflation Table
|Country||Month With Highest Inflation Rate||Highest Monthly Inflation Rate||Equivalent Daily Inflation Rate||Time Required for Prices to Double|
|1. Peru||Aug. 1990||397%||5.49%||13.1 days|
|2. Nicaragua||Mar. 1991||261%||4.37%||16.4 days|
|3. Argentina||Jul. 1989||197%||3.69%||19.4 days|
|4. Bolivia||Feb. 1985||183%||3.53%||20.3 days|
|5. Peru||Sep. 1988||114%||2.57%||27.7 days|
|6. Chile||Oct. 1973||87.6%||2.12%||33.5 days|
|7. Brazil||Mar. 1990||82.4%||2.02%||35.1 days|
Source: Steve H. Hanke and Nicholas Krus (2013), “World Hyperinflations”, in Randall Parker and Robert Whaples (eds.) Routledge Handbook of Major Events in Economic History, London: Routledge Publishing.