What's up? Inflation->516 quintillion per cent; $100 trillion note

Since my last post on Zimbabwe hyperinflation crisis, a lot has changed. Unfortunately, the change has been for worse.

In July 2008:

• Inflation rate was 2.2 million per cent a year
• Highest denomination of currency was Z$100 billion note

Later, Zimbabwean central bank slashed 10 zeros from the currency notes on Aug 1, 2008. So, Z$100 billion note became Z$10.

In our presentation, we had reported that zeros were coming back. So, where does it stand now?

In Dec 2008:

• Inflation rate was 516 quintillion per cent (that is 516 followed by 18 zeros)!!!
• Highest denomination of currency was Z$100 trillion note (Remember this is after removing 10 zeros!)

Zimbabwe is set to create a world record.

• Cato Institute has calculated the figures based on exchange rate movements and market data, putting Zimbabwe's annual inflation rate at 516 quintillion per cent - 516 followed by 18 zeros - overtaking Yugoslavia in 1994 and putting it behind only Hungary in 1946. Prof Steve Hanke said: "... if they keep going at this pace, they have a shot at it within a month or maybe a month-and-a-half at the outside."
• In post Second World War Hungary monthly inflation reached 12,950,000,000,000,000 per cent, with prices doubling every 15.6 hours - Zimbabwean prices are currently doubling every 1.3 days.
• Zimbabweans must spend money as soon as they get it before it loses its value. But goods are in desperately short supply. Supermarkets are accepting only US dollars and South African rands, leaving those without access to foreign currency in dire straits.

Where and when will it stop?