Venezuela: National Assembly Reports 65.7% Inflation in November

RIO DE JANEIRO, BRAZIL – Venezuela closed November with a twelve-month inflation of over 4,000%, as reported on Friday by the National Assembly, a body controlled by the opposition to Nicolas Maduro’s regime.

The rate illustrates the continued hyperinflationary cycle in the Caribbean country, which reached 4.087% in the period between November 2019 and November 2020 after taking a new leap last month, announced to the press Deputy José Guerra, member of the Finance Commission of the single-chamber National Assembly.

The price variation reached 65.7% in November compared to 23.8% recorded in October, according to the report.

By videoconference, Guerra explained that the boost in prices is tied to a fast depreciation of the local currency, the Bolivar, due to the injection of liquidity to pay Christmas bonuses to government employees.

“The currency depreciation is passed on to prices,” commented Guerra, describing the situation as a “vicious cycle”. Between January and November, inflation reached 3,045.92%.

With this scenario, Guerra said when presenting the report that Venezuela continues in the state of hyperinflation it started in November 2017. “In the modern world there is no inflation, an inflation rate of 25 – 30% per month can clearly be identified as a hyperinflationary process,” he added.

According to the legislator, the “monetary expansion” to finance state spending is the main driver of the constant increase in prices in the country. “These numbers are dramatic, there is no inflation in the world, except for two or three countries, the problem (in the world) is economic growth, not inflation. Inflation is no longer a problem (in the world),” he insisted.

Parliament publishes economic indicators due to the scarcity and lack of reliability in the Central Bank of Venezuela’s (BCV) figures, controlled by the Maduro regime.

The BCV, which often records delays in the publication of economic indicators, sometimes failing to disclose some of them for months, stated that the Caribbean country accumulated an inflation of 844.1% between January and September. It has not updated these figures since then.

Venezuela, which is undergoing its seventh consecutive year of recession, closed 2019 with an inflation of 9,585.5%, according to the entity.

The Bolivar depreciated by 49.8% in November and by 92% in 2020, according to the regime’s rates.

A dollar was rated at 80,945.72 bolivars at the start of the year. It has already broken the one million mark, according to the BCV, standing at 1,029,051.92 on Friday.

In detail, entertainment, with 232.8%, was the item that suffered the highest price increase last November. It was followed by communication services and housing rentals, with 171.4% and 107.3%, respectively. Food and non-alcoholic beverages increased by 44.4%, since the basic food basket, according to the Parliament’s report, reached US$210 per month, an unaffordable amount for most Venezuelans, particularly considering that the minimum wage in the Caribbean country is less than US$1.

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