Hyperinflation Hits Lebanon: Food Prices Soar 200%, Biggest Crisis Since Civil War | Economics Bitcoin News

Bitcoin.com

Lebanon has entered hyperinflation, the first country in the Middle East and North Africa to do so. With a 462% annual inflation rate and food prices rising by almost 200% this month, Lebanon has joined Venezuela in hyperinflating. Meanwhile, the Lebanese pound has lost 82% of its value this year.

Lebanon in Hyperinflation

Lebanon has become the first country in the Middle East and North Africa (MENA) region in history to experience hyperinflation, explained Steve H. Hanke, Professor of Applied Economics at the Johns Hopkins University, and a hyperinflation expert.

How To Get Free Crypto  

Hanke and his colleague Nicholas Krus have traced 61 other instances of hyperinflation in world history, including Hungary in 1945 and Yugoslavia between 1992 and 1994 when hyperinflation peaked at 313 million percent per month. Hyperinflation occurs when a country’s inflation rate exceeds 50% per month for 30 consecutive days.

On July 22, Lebanon entered the record books with the world’s 62nd episode of hyperinflation, Hanke confirmed. He described in the National Review publication:

Now there are two ongoing hyperinflations: Lebanon’s, where the annual inflation rate is 462 percent, and Venezuela’s, where the annual rate soars at 2,219 percent.

Venezuela has been in hyperinflation since April, Hanke said. He further noted that only a small number of emerging markets are currently experiencing severe inflation problems, but the number is rising. Zimbabwe, Syria, Sudan, and Iran are all facing surging inflation, but none are currently suffering hyperinflation, he clarified.

“The underlying causes of inflation are always the same,” the professor was quoted by Reuters as saying. “Governments start running larger and larger fiscal deficits and call on the central bank to fund those deficits because tax and bond financing avenues are inadequate. In hyperinflations, central banks are required to virtually fund the governments entire fiscal operations.”

Coinbase Banner  

This is Lebanon’s worst crisis since the 1975-90 civil war, Hanke pointed out. The situation became worse when the country defaulted on its debt in March. The official data cited by Credit Libanais shows that food and clothing costs surged 190% and 172% respectively in May from a year earlier. Other reports show similar stats early this month.

The Lebanese pound has lost 82% of its value against the U.S. dollar on the black market since January. “As for the official exchange rate, the Lebanese can forget it,” Hanke remarked, adding:

Their savings are frozen in Lebanon’s banks. The banks have no dollars to exchange and have imposed capital controls (strict withdrawal limits) to avoid collapse.

What do you think about Lebanon hyperinflating? Let us know in the comments section below.

Tags in this story

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Read disclaimer

Go to Source
Author: Kevin Helms


Recommended Crypto Services, Products and Strategies:

The first thing any crypto investor needs is is a reliable and secure Crypto Wallet.  Whether you’re looking for an online wallet, hardware wallet, desktop or mobile wallet, Crypto Renegade provides you with all the Best Crypto Wallets in each category.

FreeBitcoin Banner  

Best Crypto Wallets Banner

When you’re ready to buy more crypto, or exchange your coins for others, Crypto Renegade’s list of the Best Crypto Exchanges has you covered.  The Crypto Exchanges recommended here offer everything from simplicity and convenience to advanced trading platforms and profit sharing. 

Best Crypto Exchanges Banner

If you want to learn more about the methods and tools that can be used to find Great Crypto Projects, then be sure to check out Crypto Renegade’s strategy for How To Find The Best Cryptocurrency.

Crypto Strategy Banner

For those people that don’t have any money to invest right now, or just want to understand the technology a bit more, you’ll definitely want to check out Crypto Renegade’s Free Crypto Strategy and start collecting Free Coins today!

Free Crypto Banner

What do you think about cryptocurrency? Do you have any questions about it? Be sure to leave a comment below.

This site uses Akismet to reduce spam. Learn how your comment data is processed.