Venezuela’s Central Bank Announces Sudden Currency Redenomination Amid Hyperinflation Crisis
CARACAS (Reuters) — In a formal address from the Miraflores Palace, the Central Bank of Venezuela has issued an urgent directive to redenominate the national currency, the bolívar, at a ratio of one million to one, effective immediately. The announcement, made at 10:00 AM local time today, follows a sustained period of hyperinflation that has eroded the bolívar’s value by over 95% in the past twelve months. According to Central Bank President José Ignacio Hernández, the new digital currency, designated as the “digital bolívar,” will aim to stabilize the economy, curb informal dollarization, and restore confidence amid ongoing sanctions. This redenomination marks the third such measure in the past five years, with the previous effort in 2021 removing six zeros. Analysts question the efficacy of the move, noting persistent structural deficits and a lack of foreign reserves. Citizens have been granted a ninety-day window to exchange old notes for new digital units, with all public and private transactions mandated to comply by the end of the week.