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Venezuelan ISO change October 1


nfire
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Statement from the ISO 4217 Maintenance Agency
The Bolívar Soberano (VES) is redenominated by removing six zeros from the denominations. A new currency code VED/926 representing the new valuation (1,000,000 times old VES/928) is introduced on 1 October 2021 for any internal needs during the redenomination process, but is not replacing VES as the official currency code. The Central Bank of Venezuela will not adopt the new codes in the local system, VES/928 remains in use.
The actual currency code VES/928 remains the valid code after 1 October 2021 to use in any future transactions to indicate the redenominated Bolívar Soberano.
Until further notice, VES/928 and VED/926 remain on "List one: Currency, fund and precious metal codes".
Kind regards,
SIX Financial Information AG ISO 4217 Maintenance Agency

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51 minutes ago, nfire said:

Statement from the ISO 4217 Maintenance Agency
The Bolívar Soberano (VES) is redenominated by removing six zeros from the denominations. A new currency code VED/926 representing the new valuation (1,000,000 times old VES/928) is introduced on 1 October 2021 for any internal needs during the redenomination process, but is not replacing VES as the official currency code. The Central Bank of Venezuela will not adopt the new codes in the local system, VES/928 remains in use.
The actual currency code VES/928 remains the valid code after 1 October 2021 to use in any future transactions to indicate the redenominated Bolívar Soberano.
Until further notice, VES/928 and VED/926 remain on "List one: Currency, fund and precious metal codes".
Kind regards,
SIX Financial Information AG ISO 4217 Maintenance Agency

Where did you find this? 

 

I searched and found some verification of Oct 1st change on Wikipedia but would like to find this article if possible. Thank you in advance👍

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https://www.six-group.com/dam/download/financial-information/data-center/iso-currrency/amendments/dl_currency_iso_amendment_170.pdf
 

I had signed up for any currency changes long ago and still get emailed updates . Where to sign up I couldn’t tell you because it’s probably been 7-8years ago. Looks like the six group has taken over reporting for currency-iso(dot)org

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2 hours ago, nfire said:

https://www.six-group.com/dam/download/financial-information/data-center/iso-currrency/amendments/dl_currency_iso_amendment_170.pdf
 

I had signed up for any currency changes long ago and still get emailed updates . Where to sign up I couldn’t tell you because it’s probably been 7-8years ago. Looks like the six group has taken over reporting for currency-iso(dot)org

Thank you nfire, great info!!

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2 hours ago, nfire said:

https://www.six-group.com/dam/download/financial-information/data-center/iso-currrency/amendments/dl_currency_iso_amendment_170.pdf
 

I had signed up for any currency changes long ago and still get emailed updates . Where to sign up I couldn’t tell you because it’s probably been 7-8years ago. Looks like the six group has taken over reporting for currency-iso(dot)org

From the form you provided -

"Effective from 1 October 2021, the following addition will be made to “List one: Currency, fund and precious metal codes”:

 

"Currency, fund and precious metal codes"

 

We are all going to an asset backed currency and our lovely IQD investment will happen soon!!

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4 hours ago, nfire said:

Statement from the ISO 4217 Maintenance Agency
The Bolívar Soberano (VES) is redenominated by removing six zeros from the denominations. A new currency code VED/926 representing the new valuation (1,000,000 times old VES/928) is introduced on 1 October 2021 for any internal needs during the redenomination process, but is not replacing VES as the official currency code. The Central Bank of Venezuela will not adopt the new codes in the local system, VES/928 remains in use.
The actual currency code VES/928 remains the valid code after 1 October 2021 to use in any future transactions to indicate the redenominated Bolívar Soberano.
Until further notice, VES/928 and VED/926 remain on "List one: Currency, fund and precious metal codes".
Kind regards,
SIX Financial Information AG ISO 4217 Maintenance Agency

According to xe.com, 1 USD=4,219,287.62 VES and become 1 VES=0.000000237 USD. If delete 6 zeros, that means 

1 VES=0.23 USD. Is this revaluation or redenomination? Just wonder has the central bank of venezuela already been releasing lower denoms note to the publics yet?

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To bad I didn’t buy some Venezuelan dollars! I would be rich now!!! I was dumb enough to buy dinar 12 years ago!!! Well, I’m not going to cry over spilled milk! Maybe we will see, the so called RV next year!! Then we can have wheel chair races, at our big party in Vegas instead of dancing the night away!!! JMHO 🤠

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Venezuela introduces new currency with six fewer zeros

A new currency with six fewer zeros debuts Friday in Venezuela, whose currency has been made nearly worthless by years of the world’s worst inflation.

Published: 01st October 2021 02:03 PM  |   Last Updated: 01st October 2021 02:04 PM

A man counts Bolivar bills that amount to $1, at a bus stop in Caracas, Venezuela.

A man counts Bolivar bills that amount to $1, at a bus stop in Caracas, Venezuela. 

 

CARACAS: A new currency with six fewer zeros debuts Friday in Venezuela, whose currency has been made nearly worthless by years of the world’s worst inflation.

The highest denomination until now was a 1 million bolivar bill that was worth a little less than a quarter as of Thursday. The new currency tops out at 100 bolivars, a little less than $25 — until inflation starts to eat away at that as well.

The million-to-1 change for the bolivar is intended to ease both cash transactions and bookkeeping calculations in bolivars that now require juggling almost endless strings of zeros.

“The most important and fundamental reason is that the payment systems are already collapsed because the number of digits make the payment systems and doing the math practically unmanageable,” said Jose Guerra, an economics professor at the Central University of Venezuela. “These debit card payment processing systems or an accounting system for companies... are not intended for hyperinflation, but for a normal economy.”

Under the old system, a two-liter bottle of soda pop could cost more than 8 million bolivars — and many of those bills were scarce, so a customer might have to pay with a thick wad of paper.

Banks allowed customers to withdraw a maximum of 20 million bolivars in cash per day, or sometimes less if the branch was running short.

So, consumers have come to rely on U.S. dollars and digital payment methods, such as Zelle and PayPal, to make purchases. Nowadays, most transactions are made electronically, and Guerra said, more than 60% are made in U.S. dollars.

When Venezuela’s Central Bank announced the currency change last month, officials said payment systems will be modernized to expand digital use of the bolivar.

They also underscored that the elimination of six zeros doesn't otherwise affect the value of the currency. The bolivar “will not be worth more or less; it is only to facilitate its use on a simpler monetary scale," according to a Central Bank statement.

This is the third time Venezuela's socialist leaders have lopped zeros off the currency. The bolivar lost three zeros in 2008 under the late President Hugo Chávez, while his successor, current President Nicolás Maduro, eliminated five zeros in 2018.

After more than four years of hyperinflation, many Venezuelans think the new bills will be short-lived as well. The central bank does not publish inflation statistics anymore, but the International Monetary Fund estimates that Venezuela's rate at the end of 2021 will be 5,500%.

“I only had 3 million bolivars in my account, with that you don’t buy a single (piece of bread), said Elena Díaz, a 28-year-old cleaning worker standing outside a supermarket. "When they remove the six zeros, with those 3 bolivars, I won’t be able to buy anything either.“

The use of greenbacks accelerated after Maduro’s government two years ago gave up its long and complicated efforts to restrict transactions in dollars in favor of the local currency — restrictions that only fed inflation.

Dollar bills flow into Venezuela through a network of foreign bank account holders who charge commissions or via people traveling home with cash.

Ahead of the change, some stores already had begun to display three prices for each product, in U.S. dollars as well as new and old bolivars.

Banks said they would freeze operations for several hours between Thursday and Friday to make adjustments for the change.

Guerra, who was an adviser to a former opposition presidential candidate, said Venezuelans are now used to currency adjustments — and more may be coming unless government policies change.

“Basically, if there is no economic program to stop hyperinflation, this will happen again...,” Guerra said. “The problem is that hyperinflation was so aggressive in 2018 and 2019 that the reconversion of 2018 (when five zeros were trimmed off) was lost in a year and a half.”

 

link  :  https://www.newindianexpress.com/world/2021/oct/01/venezuela-introduces-new-currency-with-six-fewer-zeros-2366289.html

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Venezuela | The bolivar loses six zeros in a new currency conversion

Venezuela | The bolivar loses six zeros in a new currency conversion
There is a place in the world where children play in the street with legal tender bills as if they were trading cards. That place is Venezuela, where bolivars have become dead paper due to the highest hyperinflation in the world. To give you an idea, this Thursday, September 30, a day before the currency conversion, it took almost four million two hundred thousand bolivars to obtain a single dollar.
 

The sovereign bolivar gives way to the digital bolivar, with six zeros less

In search of a solution, the Venezuelan government cuts to the bone. This Friday, the sovereign bolivar will give way, after amputation of six zeros, to the digital bolivar, which despite its name is not a cryptocurrency. That means that for every million sovereign bolivars, a digital bolivar will be obtained. This monetary reconversion is the third that Venezuelans have experienced so far this century.

Among the population, who have seen their purchasing power melt like ice in the sun, there is a feeling that this reconversion, apart from ending the dizziness of endless zeros, is not going to bring any improvement to an economy, almost totally dollarized.

Dollarized economy, while the Colombian peso circulates near the border

In the shop windows and shops, the dollar reigns. About 70% of transactions in Venezuela are already made in greenbacks. And when it is not, other alternatives are sought.

In Puerto Concha, a fishing village in the state of Zulia, bordering Colombia, the bolivar is already part of history. Instead, Colombian pesos are used.

“At least it’s more stable”says a merchant in reference to Colombian pesos.

“The bolivar does not give us. It is easier with the peso than with the bolivar”adds a woman.

Venezuelans juggle living in an economy that has been in recession for eight years and hyperinflation for four. Given the collapse of the national currency, which has lost more than 72% of its value so far this year alone, citizens are looking for a bit of economic certainty, whether it comes from the dollar or the Colombian peso.

 

link  :  https://today.in-24.com/News/401624.html

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Venezuelan VP Rodriguez Announces New Digital Bolivar Currency

Nicolás Maduro confirmed that the five-day collapse of Banco de Venezuela was caused by a

 

Published 27 September 2021

 

Venezuelan financial authorities assured that the exchange market value will be maintained, as well as the value of the Bolivar.

 

Venezuela's executive vice-president, Delcy Rodríguez, announced this Monday a new monetary expression of the bolivar, suppressing six zeros from the current value, in an effort to achieve the monetary sovereignty of the South American country.

 

“Any amount expressed in national currency will be divided by 1 million. That is to say, 1 million is going to be equal to one bolivar, 6 million equals 6 bolivars”, indicated the vice-president in a press conference. “What we are doing is deleting six zeros in our national currency to make it easier to use and give a boost to the digital expression of our national currency, which will ease transactions in our currency,” she added.

“We are not affecting the value of the bolivar at all”, clarified Rodríguez, who affirmed that “this change is only a monetary scale and that the Central Bank of Venezuela will continue to offer physical bolivars both in coins and paper.”

 

link  :  https://www.telesurenglish.net/news/Venezuelan-VP-Rodriguez-Announces-New-Digital-Bolivar-Currency-20210927-0020.html

Nicolás Maduro confirmed that the five-day collapse of Banco de Venezuela was caused by a "terrorist attack" aimed at affecting the implementation of the digital bolivar on October 1s

Nicolás Maduro confirmed that the five-day collapse of Banco de Venezuela was caused by a "terrorist attack" aimed at affecting the implementation of the digital bolivar on October 1s

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Venezuelan Central Bank's headquarter. File photo.

 

Venezuela Confirms Currency Rebranding as of October 1: ‘Digital Bolívar’ will Erase Six Zeros

As of October 1, the digital bolívar will come into effect, eliminating six zeros from Venezuela’s currency, the Central Bank of Venezuela (BCV) announced through an official statement. Any amount or transaction expressed in bolivars will be divided by one million, the bank explained. The BCV indicated that this change in the monetary scale seeks to strengthen the development of the national economy, and will not affect the real value of our currency. The BCV also released images of the new banknotes and the new currency that will be valid from that date onwards.

The digital and physical bolívar will coexist, with the following denominations in circulation: the one bolívar coin; bills of five bolívares, 10 bolívares, 20 bolívares, 50 bolívares and 100 bolívares.

This monetary decision was long awaited for many in Venezuela tired of the exaggerated amount of zeros involved in even the most simple transactions, a result of the hyperinflation that has affected Venezuelans since 2018—a direct result of the illegal United States and European blockade of the country, aiming at overthrowing the government of Nicolás Maduro.

The currency redenomination was reported by Bloomberg a couple of months ago but Venezuelan authorities did not release an official statement until today. Many in Venezuela have been expecting the decision for weeks.

E8CGormVkA4oBIw-300x300.jpeg.webp?is-pending-load=1E8B7d_-UUAkRdKa-300x300.jpeg.webp?is-pending-load=1E8B7d_VXIAE5RyL-300x300.jpeg.webp?is-pending-load=1

 

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Below is a full unofficial translation of the Central Bank’s statement:

 

As of October 1, 2021, the digital bolívar will come into effect, applying a monetary scale that removes six (6) zeros from the national currency. In other words, all monetary amounts and everything expressed in national currency will be divided by one million (1,000,000).

This change in the monetary scale, supported by the strengthening and development of the digital economy in Venezuela, constitutes a necessary historical step at a time when the country begins the path of economic recovery, after the crisis produced by the brutal attack on our country, economy, and our national currency due to the criminal application of an economic and financial blockade [by the United States and Europe].

The introduction of the digital bolívar does not affect the value of the currency. In other words, the bolívar will not be worth more or less, the goal is to facilitate its use with a simpler monetary scale.

In order to include all Venezuelans and attend to their transactional needs, throughout the national territory the Central Bank of Venezuela will continue to attend to the issuance of the physical bolívar. The physical bolívar and the digital bolívar will coexist in a process aimed at restoring their strength as a measure and expression of our economy.

The reference exchange rate will continue to be determined by the Venezuelan Market Exchange System and will continue to be calculated from the foreign exchange purchase and sale operations carried out by individuals and companies, through the exchange desks of banking entities.

The transformation of the national currency into its digital format, its use and promotion through new and existing electronic means of payment, will allow:

• Advance in the construction of a updated vision of the currency in everyday transactions.
• Facilitation of greater connectivity of the population with its currency, despite the constant external attacks and speculative processes that have been induced in the economic system.
• Reduction of transaction costs in the economy, helping to strengthen the national productive economy in a safe and transparent way.

It is also noteworthy that Venezuela is in a progressive process of modernization of its payment systems. Recently, the new free and sovereign Financial Messaging Exchange System began operations, made in Venezuela and by Venezuelans, promoting the independence of national banking operations from foreign systems, for the consolidation of the effective use of our legal tender, the bolívar.

The modernization of payment systems aims to update the use of the digital bolívar immediately, ensuring that transfers between clients of different banks are received in a few seconds, and meeting the highest international quality standards.

The National Government together with the Central Bank of Venezuela will continue to protect and guarantee monetary sovereignty in order to promote the recovery of our economy and make the independence of our country impregnable against foreign and domestic elements that attack Venezuela.

The Central Bank of Venezuela, in coordination with the Ministry of Popular Power of Economy, Finance and Foreign Trade, is responsible for implementing the Decree that will be published for this purpose.

Caracas, August 5, 2021

 

link  :  https://orinocotribune.com/venezuela-confirms-currency-rebranding-as-of-october-1-digital-bolivar-will-erase-six-zeros/

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UPDATE 2-Venezuela to cut six zeros from prices amid hyperinflation

August 5, 2021

CARACAS, Aug 5 (Reuters) - Venezuela will cut six zeros from prices as of Oct. 1, the central bank said on Thursday, the second time in three years the economically devastated South American nation has overhauled its decimated bolivar currency.

The measure will do little to address a brutal economic collapse that has forced millions to leave the country, but could make some basic accounting simpler.

 

Much of the economy has been dollarized since President Nicolas Maduro largely scrapped currency and price controls in 2019, meaning the practical impact of the measure is even less relevant than the 2018 monetary overhaul.

"The bolivar will not be worth any more or any less, in order to facilitate its use, it is being taken to a simpler monetary scale," the central bank said in a statement.

Maduro in 2018 cut five zeros from prices as inflation hit 1.8 million percent. That came on top of late socialist leader Hugo Chavez's 2008 monetary overhaul that cut three zeros from bolivar prices.

Maduro has for years blamed inflation on U.S. sanctions meant to force him from power, as well as an "economic war" he says was carried out by business leaders and political adversaries.

Economists and opposition leaders say inflation is caused by the central bank's indiscriminate expansion of the money supply to finance government spending.

"Now you know: Eliminating 11 zeros in three years is a way of making things easier," tweeted economist Luis Oliveros.

The country's economy is in tatters following years of hyperinflation, the decay of its once-powerful oil industry, and U.S. sanctions that have crippled its crude export earnings.

Economists say significant improvement to the situation will require major infrastructure investments, which are currently impossible due to a lack of capital and sanctions that leave most foreign companies reluctant to operate in Venezuela. (Reporting by Deisy Buitrago and Vivian Sequera; writing by Brian Ellsworth; editing by Jonathan Oatis)

 

link  :  https://finance.yahoo.com/news/1-venezuela-cut-six-zeros-131227432.html?fr=sycsrp_catchall

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78350011453911586_BLD_Online.jpg

 

Venezuela cuts six zeros from its own currency

October 1, 2021 by archyde

Venezuela will be issuing new banknotes from Friday, which will remove six zeros from the national currency Bolívar in the face of hyperinflation and the severe economic crisis. All sums are divided by a million, according to the country’s central bank. It is the third such reform in the South American country in 13 years.

New banknotes

According to the central bank, the new banknotes should be available in denominations of 5, 10, 20, 50 and 100 bolívar. There is also said to be a one bolívar coin. In addition, the government wants to establish a new digital currency, the “digital bolívar”.

The central bank announced in February that inflation in 2020 was nearly 3,000 percent. The oil-rich South American country has been in a serious crisis for years. In 2019, the price increase was almost 9,600 percent. A loaf of bread last cost around seven million bolívar.

Not the first time

Ex-head of state Hugo Chávez had already deleted three zeros in 2008, in the summer of 2018 five zeros were again deleted under his successor Nicolás Maduro. Venezuela thus achieves the dubious fame of being the country in South America that has deleted the most zeros from its currency.

 

link  :  https://www.archyde.com/venezuela-cuts-six-zeros-from-its-own-currency/

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http://static.pulzo.com/images/20210929091930/bolivares-900x485.jpg

Currency reconversion in Venezuela will remove 6 zeros from the bolivar

September 29, 2021 by memesita

With the elimination of the 6 zeros, the bolivar reaches 14 zeroes eliminated in total since 2008.

One million bolivars, about 25 cents on the dollar not enough to buy a loaf of bread, will be a bolivar … and that bolivar in turn represents 100 billion bolivars in 2007, a reflection of an incredible erosion: the national budget for that year reached 115 trillions of bolivars, which were more than 50,000 million dollars.

Wages in Venezuela were diluted due to hyperinflation

“We charge, biweekly, less than three dollars”Marelys Guerrero, a 43-year-old teacher who charges millions that are worth nothing, tells the AFP agency. (See also: An iPhone 13 costs 3 months of minimum wage in Colombia; in Venezuela, it would be 20 years).

De facto, ordinary people made a conversion and it is normal to speak of thousands to refer to millions during the crisis in Venezuela.

The outgoing monetary cone, which is capped at the 1 million bill, will coexist for a few months with the new one and its denominations: a one bolivar coin and 5, 10, 20, 50 and 100 bolivar bills.

Marelys is afraid of rounding. If something remains at 4.5 after the conversion, “it will not cost 4.5, but 5,” says this woman in a store in Chacaito, a commercial area of Caracas.

With Venezuelans trying to protect themselves from the highest inflation in the world, projected at 1,600% for this year by the private firm Ecoanalítica, the dollar has displaced the bolivar and more than two-thirds of transactions in Venezuela are made in that currency, according to private estimates.

This scenario has made, for example, buying a house an almost impossible task, even for people with considered high salaries.

The situation led both to a chronic shortage of cash and relegated the bolivar to transactions with debit cards and bank transfers. The little ‘cash’ circulating is used basically in public transport.

President Nicolás Maduro speaks of “digital bolivar”, calling for the total “digitization” of payments.

That idea is in advance a surrender, affirms Luis Arturo Bárcenas, from Ecoanalítica. “There is surely not going to be a sufficient cash endowment (…). You are recognizing that you do not have the capacity to issue all the banknotes in bolivars that you require ”, explains this economist.

Banking systems will be paralyzed Thursday night for technical adjustments.

An endless amount of zeros

While Marelys fears new inflationary jumps, working with six less zeros comforts the accountant Rodrigo Bermúdez. (See also: Who is looking for Xbox in Colombia, to save until December 2021; in Venezuela, until 2045).

“It’s a relief for us,” says Bermúdez, who shows AFP an invoice in which he has to divide a collection into four parts to be able to include it in the accounting systems used in his company. They are endless numbers. Illegible.

“The number of digits was making everything very cumbersome,” he adds.

Reconversions were common in Latin America, especially in times of hyperinflation in countries like Argentina, Brazil or Peru in the 1980s and 1990s. Argentina even created another currency, the austral, which later disappeared to return to the peso.

Although Maduro restricted public spending and limited credit, which has practically disappeared, prices continue to rise, even in dollars.

“If one expects inflation to behave the same as in recent months, it is very likely that in three or four years the government will have to reconvert again,” warns Bárcenas.

This reconversion occurs only three years after the previous one, in 2018, which eliminated five zeros from the bolivar.

Dollar market in Venezuela

“I’ll buy you your dollar!” Shout young people with thick bands of bolivar bills at a bus stop heading to dormitory cities near Caracas.

In the absence of cash, buses and stops are mobile exchange houses.

“We pay the dollars at four million. The ticket costs two million ”, says William Hernández, a 56-year-old transporter.

The image became everyday after the dollar was banned from the streets for 15 years by an exchange control established by the late Hugo Chávez in 2003. Although it still exists, this mechanism was later made more flexible due to the collapse of income as a result of the collapse of the Venezuelan oil industry and international sanctions against the country.

Maduro describes informal dollarization as “An escape valve”.

 

link  :  https://www.memesita.com/currency-reconversion-in-venezuela-will-remove-6-zeros-from-the-bolivar/

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Venezuela eliminates 6 zeros from the bolivar in new reconversion

Venezuela eliminates 6 zeros from the bolivar in new reconversion

 

 

A million of bolivars, Some 25 cents on the dollar are not enough to buy a loaf of bread, it will be a bolivar … and that bolivar in turn represents 100 billion bolivars in 2007, a reflection of an incredible erosion: the national budget that year reached 115 billion bolivars , which were more than 50,000 million dollars.

Diluted salaries

Wages in Venezuela, along the way, dissolved. “We charge less than three dollars a fortnight,” Marelys Guerrero, a 43-year-old teacher who receives millions that are worth nothing, tells AFP.

De facto, ordinary people made a conversion of bolivars and it is normal to speak of thousands to refer to millions.

The outgoing monetary cone of Venezuela, which is capped at the 1 million bill, will coexist for a few months with the new one and its denominations: a one bolivar coin and 5, 10, 20, 50 and 100 bolivar bills.

Marelys is afraid of rounding. If something remains at 4.5 after the conversion, “it will not cost 4.5, but 5,” says this woman in a store in Chacaito, a commercial area of Caracas.

With Venezuelans trying to protect themselves from the highest inflation in the world, projected at 1,600% for this year by the private firm Ecoanalytic, the dollar has displaced the bolivar and more than two-thirds of transactions in Venezuela are made in that currency, according to private estimates.

The situation led both to a chronic shortage of cash and relegated the bolivar to transactions with debit cards and bank transfers. The little cash circulante is basically used in public transport.

The Venezuelan dictator Nicolás Maduro speaks of “digital bolivar”, asking for the total “digitization” of payments with the new reconversion.

That idea is in advance a surrender, affirms Luis Arturo Bárcenas, from Ecoanalítica. “There will surely not be enough cash endowment (…). You are recognizing that you do not have the capacity to issue all the bolivar bills that you require,” explains this economist.

The banking systems will be paralyzed Thursday night for technical adjustments prior to the reconversion.

banknotes-bolivares-venezuela-afp-september.jpg

500,000 bolivars banknotes in Venezuela.

Endless zeros

While Marelys fears new inflationary jumps, working with six less zeros comforts the accountant Rodrigo Bermúdez.

“It is a relief for us,” says Bermúdez, who shows AFP an invoice in which he must divide a collection into four parts in order to include it in the accounting systems used in his company. They are endless numbers. Illegible.

“The number of digits was making everything very cumbersome,” he adds.

Reconversions were common in Latin America, especially in times of hyperinflation in countries such as Argentina, Brazil or Peru in the 1980s and 1990s. Argentina even created another currency, the austral, which later disappeared to return to the peso.

Although Maduro restricted public spending and limited credit, which has practically disappeared, prices continue to rise, even in dollars.

“If one expects inflation to behave the same as in recent months, it is very likely that in three or four years the regime will have to reconvert again,” warns Bárcenas.

This reconversion occurs only three years after the previous one, in 2018, which eliminated five zeros from the bolivar.

“I buy you your dollar”

“I’ll buy you your dollar!” Shout young people with thick bands of bolivar bills at a bus stop heading to dormitory cities near Caracas.

In the absence of cash, buses and stops are mobile exchange houses.

“We pay four million dollars. The ticket costs two million,” says William Hernández, a 56-year-old carrier.

The image became everyday after the dollar was banned from the streets for 15 years by an exchange control established by the late dictator Hugo Chávez in 2003. Although it still exists, this mechanism was later made more flexible due to the collapse of income as a result of the collapse. of the Venezuelan oil industry and international sanctions against the country.

Meanwhile, the dictator Maduro describes informal dollarization as “an escape valve.”

 

link  :  https://today.in-24.com/News/396802.html

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Venezuela lops another six zeros off its currency

Maduro regime rolls out ‘digital bolívar’ in latest rebrand amid sky-high inflation and waning usage
A bus passenger hands over 500,000 bolívars
A bus passenger hands over 500,000 bolívars. The new ‘digital bolívar’ will be worth 1m old ones, with a value of roughly 24 US cents

Vanessa Silva in Caracas and Gideon Long in Madrid  11 HOURS AGO

 

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Venezuela has lopped six zeros off its currency in another bid to make the bolívar more manageable and rebrand it after years of hyperinflation. On Friday, new bolívar notes went into circulation, with one new bolívar worth 1m old ones. There are currently around 4.2m old bolívars to the dollar, so one new bolívar is worth about 24 US cents. The new notes range from five to 100 bolívars and there is a 1 bolívar coin. This is the third time Venezuela’s revolutionary socialist rulers have trimmed the currency. In 2008, president Hugo Chávez cut three zeros from the banknotes and in 2018, amid hyperinflation, his successor and current leader Nicolás Maduro got rid of another five and devalued the currency by 95 per cent. The new banknotes come with a name change. This is now the “digital bolívar”, although it is no more digital than any other currency. The previous incarnation was the “sovereign bolívar” and the one before that the “strong bolívar”. The elimination of the zeros should make life simpler for long-suffering Venezuelans who have had to grapple with dizzying numbers, although it is unlikely to have much of an effect on economic fundamentals. “The only thing is that bank transfers will have fewer zeros,” said Henry Andrade, a fruit and vegetable merchant from the western state of Táchira on the border with Colombia. “Here in the village where we live the only currencies that circulate are Colombian pesos and dollars. The only thing we use bolívars for is to buy pesos.” The Venezuelan economy has collapsed since Maduro came to power in 2013, and the country has been wracked by spiralling price rises. Steve Hanke, a professor of applied economics at Johns Hopkins University, says the first hyperinflationary bout, from 2016 to 2019, lasted 28 months — the fifth longest on record. A second bout in 2020 lasted nine months. According to the Venezuelan Observatory of Finance (OVF), a non-government body that measures price rises slightly differently, hyperinflation began in 2017 and has not stopped, making this the second longest bout on record anywhere in the world, surpassed only by Nicaragua in the late 1980s. The sustained price rises prompted people to start using dollars. Even when Venezuelans use bolívars these days, for example when paying utility bills, they tend to pay with debit cards to avoid the hassle of piles of cash. “Dollarisation has helped because it’s allowed things to level out and stabilise,” said 62-year-old Carmen Gutiérrez, the owner of a small clothing shop in Caracas. Local consultancy Ecoanalítica said more than two-thirds of financial transactions in Venezuela were now made in foreign currency, predominantly the dollar.
The new so-called ‘digital bolivar’ banknotes
The new so-called ‘digital bolivar’ banknotes © Banco Central de Venezuela
 
In recent months, inflation has eased although it is still running at over 1,700 per cent annually, according to the OVF. In August, monthly inflation was a relatively modest 10.6 per cent, and it has been below the 50 per cent hyperinflationary threshold for the past six months. “The spontaneous dollarisation of Venezuela has cut the legs out from under the country’s hyperinflation,” Hanke said. The government blames US sanctions for Venezuela’s economic woes, even though the economy started to tank before Washington imposed its first sector-wide measures. In launching the renewed currency, the Maduro regime claimed it was the victim of a “brutal attack on our economy [and] our national currency” via “the criminal application of an economic and financial blockade”. “We all suffer the consequences,” said 71-year-old Fernando Alvarado, a retired state employee and government supporter. “It’s the people who suffer”. The government said the digital bolívar would “help to deepen and develop the digital economy in Venezuela” and has vowed to create a digital currency, saying “the physical and digital bolívar will live alongside one another”. But that appears unlikely in a country where power cuts are frequent and mobile phone coverage is patchy. “There isn’t the infrastructure for it. It isn’t deep, it isn’t stable and it isn’t widespread,” said Tamara Herrera, director of local consultancy Síntesis Financiera. In 2018, amid much fanfare, the government launched an oil-backed cryptocurrency called the petro, which has largely sunk without trace. “No one has ever paid us in petros,” fruit and veg wholesaler Andrade said. While the introduction of the new banknotes should bring practical benefits to shoppers and shopkeepers and might even persuade some to use the national currency again, it has also sowed confusion. One shopkeeper, asked how many zeros were being lopped off the currency this week, replied: “five”. Asked how much a bag of flour would now cost, she said: “One bolívar, I think. No, five!”
 
 
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Venezuela Introduces New Currency With 6 Fewer Zeros

Friday, October 1, 2021 at 2:42 pm
venezuela new currency
A man shows new 10-Bolivar bank notes after withdrawing them from a cash machine in Caracas, Venezuela, Friday.
 
CARACAS, Venezuela (AP) -

A new currency with six fewer zeros debuted Friday in Venezuela, whose currency has been made nearly worthless by years of the world’s worst inflation.

But the new bills were nowhere to be found in the capital, where consumers’ fears that prices will continue to spiral upward proved to be right.

“Today, I went to the supermarket and everything was marked in dollars,” Lourdes Pórtelo, an office worker, said in a shopping center in the east side of Caracas. “In the end, I couldn’t buy anything, I didn’t have enough money.”

Before the adjustment, the highest denomination was a 1 million bolivar bill that was worth a little less than a quarter as of Thursday. The new currency tops out at 100 bolivars, a little less than $25 — until inflation starts to eat away at that as well.

The million-to-one change for the bolivar is intended to ease both cash transactions and bookkeeping calculations in bolivars that now require juggling almost endless strings of zeros.

“The most important and fundamental reason is that the payment systems are already collapsed because the number of digits make the payment systems and doing the math practically unmanageable,” said Jose Guerra, an economics professor at the Central University of Venezuela. “These debit card payment processing systems or an accounting system for companies … are not intended for hyperinflation, but for a normal economy.”

Under the old system, a two-liter bottle of soda could cost more than 8 million bolivars — and many of those bills were scarce, so a customer might have to pay with a thick wad of paper.

Banks allowed customers to withdraw a maximum of 20 million bolivars in cash per day, sometimes less if the branch was running short.

So consumers have come to rely on U.S. dollars and digital payment methods, such as Zelle and PayPal, to make purchases. Nowadays, most transactions are made electronically, and Guerra said that more than 60% are made in U.S. dollars.

When Venezuela’s Central Bank announced the currency change last month, officials said payment systems will be modernized to expand digital use of the bolivar. They also underscored that the elimination of six zeros doesn’t otherwise affect the value of the currency. The bolivar “will not be worth more or less; it is only to facilitate its use on a simpler monetary scale,” according to a Central Bank statement.

But currency exchange differences confirmed people’s fears that prices would go up when the currency change occurred.

The price of the dollar on the black market rose Friday by more than 500,000 bolivars and stood at 5,200,000 in the previous denomination and 5.2 bolivars per dollar in the new currency. The official exchange rate increased slightly to 4,181,781.84 bolivars, but most businesses use the black market dollar as a reference for setting prices.

This is the third time Venezuela’s socialist leaders have lopped zeros off the currency. The bolivar lost three zeros in 2008 under the late President Hugo Chávez, while his successor, current President Nicolás Maduro, eliminated five zeros in 2018.

After more than four years of hyperinflation, many Venezuelans think the new bills will be short-lived as well. The central bank does not publish inflation statistics anymore, but the International Monetary Fund estimates that Venezuela’s rate at the end of 2021 will be 5,500%.

“I only had 3 million bolivars in my account, with that you don’t buy a single (piece of bread),” said Elena Díaz, a 28-year-old cleaning worker standing outside a supermarket. “When they remove the six zeros, with those 3 bolivars, I won’t be able to buy anything either.“

The use of greenbacks accelerated after Maduro’s government two years ago gave up its long and complicated efforts to restrict transactions in dollars in favor of the local currency — restrictions that only fed inflation.

Dollar bills flow into Venezuela through a network of foreign bank-account holders who charge commissions or via people traveling home with cash.

Ahead of the change, some stores already had begun to display three prices for each product, in U.S. dollars as well as new and old bolivars. By Friday morning, some had prices only in dollars.

Banks were to freeze operations for several hours between Thursday and Friday to make adjustments for the change. In Caracas, many branches did not open Friday, but according to the Superintendency of Institutions of the Banking Sector, electronic transactions were active in most banks.

Guerra, who was an adviser to a former opposition presidential candidate, said Venezuelans are now used to currency adjustments — and more may be coming unless government policies change.

“Basically, if there is no economic program to stop hyperinflation, this will happen again,” Guerra said. “The problem is that hyperinflation was so aggressive in 2018 and 2019 that the reconversion of 2018 (when five zeros were trimmed off) was lost in a year-and-a-half.”

 

link  :  https://hamodia.com/2021/10/01/venezuela-introduces-new-currency-with-6-fewer-zeros/

 
 
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6 zeroes cut as Venezuela recalibrates battered currency

6 zeroes cut as Venezuela recalibrates battered currency

6 zeroes cut as Venezuela recalibrates battered currency

 

01 Oct 2021 07:40PM(Updated: 01 Oct 2021 07:41PM)

Caracas: Venezuela unveils new banknotes on Friday (Oct 1) to once again slash zeroes off its currency, battered by runaway inflation that has compounded the country's economic collapse and left many struggling to put food on the table.

The national economy has shrunk by 80 per cent since 2013 as the oil price crashed and output dwindled during decades of under-investment, US sanctions, and mismanagement by successive socialist governments.

The latest banknote reform is the third in 13 years and gives Venezuela the dubious distinction of becoming the South American country to have removed the most zeroes from its currency.

Seven one-million bolivar notes - the highest denomination and very hard to come by - were needed to pay in cash for one loaf of bread in the once-rich oil-producing nation, now battling the world's highest inflation rate.

Consumers have struggled to make payment for even the most basic goods or services and public sector workers have found themselves receiving salaries paid in millions of bolivars that are effectively worth nothing.

"We earn, fortnightly, less than three dollars," teacher Marelys Guerrero, 43, told AFP in Caracas.

Rent for an apartment in a modest suburb of the capital starts from about US$150, while a basket of basic groceries for a family of five costs about US$220.

Most payments in bolivars are done by debit card or bank transfer, but 70 per cent of transactions are now conducted in US dollars, according to private sector estimates, and prices on many shop shelves are displayed in the US currency, to keep things simpler.

'I'll buy your dollar!'

The bolivar lost three zeros in 2008 under now-deceased President Hugo Chavez, whose successor Nicolas Maduro eliminated five more in 2018.

With Friday's change, a million bolivars will overnight become one - still the equivalent of about US$0.25.

In Venezuela's border regions, besides the dollar, it is common to also pay for goods in Colombian pesos or Brazilian reais, and even grams of gold.

In the rest of the country, cash is used almost exclusively for purchasing public transport tickets, but even this presents a headache as notes are scarce and can only be obtained by standing in long queues at the bank.

"I'll buy your dollar!" - children with thick wads of bolivar bills yell at buses that, along with bus stops, have become informal currency exchange offices.

"We pay one dollar for 4 million bolivars. The fare costs 2 million," said William Hernandez, a 56-year-old bus driver.

The government will issue new banknotes in denominations of five, 10, 20, 50, and 100 bolivars, as well as a one-bolivar coin after Friday's change.

But the government has also said that it wants the economy to become entirely digital, a move, experts say, is meant to avoid printing money that will just continue devaluing.

"It is very likely that in about three or four years the government will have to reconvert again," Luis Arturo Barcenas of economic consultancy Ecoanalitica told AFP.

'It's a relief'

The bolivar has lost nearly all its value in just over a decade - shedding almost 73 per cent in 2021 alone.

The country's annual budget of 115 billion bolivars in 2007 - then the equivalent of US$50 billion - if held in the local currency, would be worth less than a dollar today.

Venezuela is battling its eighth year of recession as well as hyperinflation that reached nearly 3,000 per cent in 2020 and more than 9,500 per cent the year before, according to central bank figures.

In May, the government tripled the minimum monthly wage but the new amount was not enough even to buy a kilogram of meat.

Three in four Venezuelans today live in extreme poverty, according to an academic study published on Wednesday, with the economic collapse worsened by the coronavirus pandemic.

Millions have left the country in recent years to try their luck elsewhere, but many have ended up as refugees.

While consumers like Guerrero fear Friday's readjustment of the bolivar could further squash their pocket with shopkeepers rounding up prices, others like Caracas accountant Rodrigo Bermudez welcome the change.

"It's a relief ... The number of digits was making everything very cumbersome," he told AFP, showing an invoice with too many zeroes to make any sense of.

 

link  :  https://search.yahoo.com/search?p=new+bolivar+banknotes&fr=yfp-t&ei=UTF-8&fp=1

 

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Venezuela's inflation-battered bolivar sheds 6 zeroes

Venezuela's three monetary reforms since 2008 as the country, battered by runaway inflation, slashes 6 zeros off its currency

 
less than 2 min read
October 2, 2021 - 2:46PM AFP
New notes of five and 10 bolivars after Venezuela slashes six zeroes off its currency

New notes of five and 10 bolivars after Venezuela slashes six zeroes off its currency

 

 

The official exchange rate of Venezuela's bolivar went from 4.18 million to the US dollar overnight to just 4.18 as the impoverished country slashed six zeroes off its inflation-battered currency Friday to simplify transactions.

It is the third banknote reform in 13 years, with a staggering 14 zeroes shed since 2008 -- giving Venezuela the dubious distinction of becoming the South American country to have lopped the most zeroes off its currency.

Housekeeper Josefina Galindo said that she "went shopping without problems this morning. The new prices were displayed above the old ones. And there was always the price in dollars." 

The electronic platform of the public Banco de Venezuela, which has 14 million clients, was also down by mid-afternoon, with those trying to make internet transactions encountering a message apologizing for the inconvenience.

Economic consultancy Ecoanalitica expects the 2021 figure to come in at around 1,600.

Three in four Venezuelans today live in extreme poverty, according to a recent study, with the economic crisis made worse by US sanctions and the coronavirus pandemic.

- 'Lack of capacity' -

The government issued new banknotes in denominations of five, 10, 20, 50, and 100 bolivars, as well as a one-bolivar coin, but has said that it wants the economy to become entirely digital.

The biggest note in the retiring bolivar family, with a face value of a million, is worth barely $0.25 -- not enough to buy a piece of candy. It will remain in circulation in parallel with the new notes for a few months.

- Salaries of worthless millions -

Workers found themselves receiving salaries paid in millions of bolivars that are effectively worth nothing.

With so many bolivars required for a simple purchase, and with notes in short supply, 70 percent of transactions in the country are conducted in US dollars, according to private sector estimates.

In Venezuela's border regions, it is common to also pay for goods in Colombian pesos or Brazilian reais, and even grams of gold.

By morning, some shops had already adopted the new bolivar and re-priced their goods.

"I made purchases this morning without problems," Josefina Galindo, a domestic worker, told AFP. She used her debit card -- the preferred method of payment when dealing in bolivars.

 

link  :  https://www.news.com.au/breaking-news/venezuelas-inflationbattered-bolivar-sheds-6-zeroes/news-story/887851e2f99eca05d41350d3e8747bc0

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Venezuela's inflation-battered bolivar sheds 6 zeroes

AFP  19 hrs ago

The official exchange rate of Venezuela's bolivar went from 4.18 million to the US dollar overnight to just 4.18 as the impoverished country slashed six zeroes off its inflation-battered currency Friday to simplify transactions.

New notes of five and 10 bolivars after Venezuela slashes six zeroes off its currency

New notes of five and 10 bolivars after Venezuela slashes six zeroes off its currency

 

It is the third banknote reform in 13 years, with a staggering 14 zeroes shed since 2008 -- giving Venezuela the dubious distinction of becoming the South American country to have lopped the most zeroes off its currency.

Some establishments, fearful of operational problems, limited bolivar-based transactions

 Some establishments, fearful of operational problems, limited bolivar-based transactions

 

 

"Everything expressed in national currency shall be divided by a million," the central bank announced.

Housekeeper Josefina Galindo said that she "went shopping without problems this morning. The new prices were displayed above the old ones. And there was always the price in dollars." 

"The price (in dollars) has not changed," added the 52-year-old, who was shopping in the upscale Caracas district of Chacao but said she had still paid in old prices using the old bolivars when she took the bus from her working-class neighborhood of Coche.

Jose Grasso Vecchio, president of Venezuela's largest private bank, Banesco, said the new, lower, denominations would make the work of banks "easier, faster."

Jose Grasso Vecchio, president of Venezuela's largest private bank, Banesco, said the new, lower, denominations would make the work of banks "easier, faster."

 

The electronic platform of the public Banco de Venezuela, which has 14 million clients, was also down by mid-afternoon, with those trying to make internet transactions encountering a message apologizing for the inconvenience.

Venezuela's three monetary reforms since 2008 as the country, battered by runaway inflation, slashes 6 zeros off its currency

Venezuela's three monetary reforms since 2008 as the country, battered by runaway inflation, slashes 6 zeros off its currency

 

Venezuela, the once-rich oil producer, is battling its eighth year of recession and hyperinflation that reached nearly 3,000 percent in 2020 and more than 9,500 percent the year before, according to central bank figures.

 

Economic consultancy Ecoanalitica expects the 2021 figure to come in at around 1,600.

In May, the government tripled the minimum monthly wage but the new amount was not enough even to buy a kilogram of meat.

Three in four Venezuelans today live in extreme poverty, according to a recent study, with the economic crisis made worse by US sanctions and the coronavirus pandemic.

Millions have left the country in recent years to try their luck elsewhere.

- 'Lack of capacity' -

With the bolivar losing nearly all its value, seven one-million bolivar notes -- very hard to come by -- were needed to pay for one loaf of bread before Friday's currency update.

The government issued new banknotes in denominations of five, 10, 20, 50, and 100 bolivars, as well as a one-bolivar coin, but has said that it wants the economy to become entirely digital.

Analysts read this as a way to avoid printing money that will just continue devaluing, eventually requiring another readjustment.

The biggest note in the retiring bolivar family, with a face value of a million, is worth barely $0.25 -- not enough to buy a piece of candy. It will remain in circulation in parallel with the new notes for a few months.

"It (the bolivar) is not going to be worth more, it's not going to be worth less, it's just a monetary scale that we're applying by removing six zeros to facilitate transactions," Vice President Delcy Rodriguez said this week.

- Salaries of worthless millions -

According to Luis Arturo Barcenas of Ecoanalitica, the readjustment reflected a "lack of capacity by the economic actors in Venezuela to control hyperinflation," a phenomenon that "has greatly impoverished the population."

Workers found themselves receiving salaries paid in millions of bolivars that are effectively worth nothing.

In Venezuela, the minimum public service wage is the equivalent of $2.5 per month and the average salary is about $50, while a basket of basic groceries for a family of five costs about $220.

With so many bolivars required for a simple purchase, and with notes in short supply, 70 percent of transactions in the country are conducted in US dollars, according to private sector estimates.

Prices on many shop shelves are displayed in the US currency, to keep things simpler.

In Venezuela's border regions, it is common to also pay for goods in Colombian pesos or Brazilian reais, and even grams of gold.

In the 24 hours leading up to Friday's recalibration, the dollar soared on the black market though the central bank kept the official exchange rate stable.

By morning, some shops had already adopted the new bolivar and re-priced their goods.

Others, fearful of operational problems, limited bolivar-based transactions. 

"I made purchases this morning without problems," Josefina Galindo, a domestic worker, told AFP. She used her debit card -- the preferred method of payment when dealing in bolivars.

Jose Grasso Vecchio, president of Venezuela's largest private bank, Banesco, said the new, lower denominations would make the work of banks "easier, faster."

 

link  :  https://www.msn.com/en-us/news/world/venezuelas-inflation-battered-bolivar-sheds-6-zeroes/ar-AAP1ZX4#:~:text=The government issued new banknotes in denominations of,will just continue devaluing%2C eventually requiring another readjustment.

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