In a rare release of official information, the Banco Central de Venezuela (BCV) announced revealed today that money supply increased 1,069% in 2017. The figure corresponds to the total amount of money circulating in Venezuela at the close of 2017, which the BCV claimed reached Bs. 122 billion.
The BCV seldom publishes official economic information, a trend that started two years ago when the central bank stopped providing inflation figures.
Today’s figures from the BCV reveal one of the root causes of the country’s inflation crisis, which may have reached as high as 2,700% in 2017: the printing of money to fund state expenses. While inflation is a complex phenomenon, it is generally understood that increasing the number of bills in circulation without a corresponding increase in the number of goods and services available will tend to drive the price of those goods and services.
The BCV money supply numbers were released as Francisco Ibarra, the head of the Econometrica financial firm, warned that the country’s inflation rate could reach 30,000% this year, a much higher figure than the 3,000%-5,000% that other economists have forecast for 2018. In an article published in El Nuevo Herald today, Ibarra said:
Those who continue to forecast a 2018 inflation rate in Venezuela of 5,000% are not correctly understanding what is happening in the country. We could hit that 5,000% inflation rate in February.
According to Ibarra, economists have not paid attention to the acceleration in the rate of inflation that began to be registered in the second half of the year. While the August inflation rate 33.7%, the December rate was 81%.
El Nuevo Herald points out that another indicator of the country’s worsening inflation crisis is the measure how how many times per year the inflation rate doubles. According to the article, the 2017 inflation rate doubled approximately six times more than in 2016. According to economist Alexander Guerrero, 2018 could see inflation double “between 35 and 40 times”.
Political Prisoners’ Court Appearance Deferred for 44th Time
Today, the preliminary hearing for Lorent Saleh and Gabriel Valles was deferred for a 44th time, extending the pair’s stay in legal limbo indefinitely.
Saleh and Valles have been in prison since September 2014. The two belonged to an anti-government political organization called Operacion Libertad which operated partially out of Colombia, where the two men lived. They were arrested by Colombian authorities and handed over to the Maduro regime at Caracas’ request in 2014.
Saleh’s lawyer, Juan Luis Gonzalez, spoke to reporters after today’s audience was deferred due to the fact that the court did not go into session. Gonzalez said that the 44 deferrals have always had two causes: either the court is not in session, or the authorities fail to transport Saleh to the court.
The pair have often been accused by regime officials of working closely with Colombian paramilitary groups and former Colombian vice president Alvaro Uribe to overthrow the Maduro regime.
Saleh and Valles spent 26 months in solitary confinement in La Tumba [the Tomb], which is the nickname of the underground prison beneath the headquarters of the regime’s political police, the SEBIN.
Upon learning that her son’s hearing had been deferred again, Saleh’s mother said:
This is the fourth Christmas and the fourth New Year that they’re spending locked up, but they are strong and they are continuing to resist.
Saleh and Valles’ first run-in with the law was in 2011, when they were arrested carrying slingshots and anti-Chavez signs to a protest. The two fled to Colombia in 2013, where they remained until their arrest in 2014.
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