The Biggest Hyperinflations Of The Last Century

By Tomasz Wisniewski|

Published: February 09 2022, 16:31 GMT+0

The Biggest Hyperinflations Of The Last Century

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We all know that inflation is bad, and hyperinflation is probably disastrous. Can you imagine waking you and your money today worth nothing compared to just yesterday?

High inflation rates cause the prices of goods and services to inflate at a fast pace, while incomes remain the same or grow at a very slow rate. As a result, people are not able to cope with the growing standard of living.

Such a surge in prices can happen when the economy is growing very quickly, and people start demanding more products. Or it might happen in times of war when the government spends more on the army, prints more money notes, and devaluate the national currency.

In the following, we will take you through some great examples of hyperinflations that occurred in different countries over the last century. We will discuss the causes and effects on the following economies.

Hungary (1945 – 1946)

During World War II, Hungary was a battlefield between the Nazis and the Russians and was heavily destructed. The economy suffered from the majority of manufacturers and infrastructure being demolished.

In the years 1945 and 1946 Hungary witnessed probably the worst hyperinflation in history, the government could not manage the inflation and the prices were growing very quickly. 

Inflation rate

Money was being printed at an extremely fast pace, which blew up the whole national economy. By July 1945 there were 25 billion Pengo in circulation, and by July 1946 there was 47 Septillion Pengo in the country’s economy.

At the same rate, something that cost 379 Pengo in September 1945, would cost 1 trillion trillion by end of July 1946. It was challenging for people to pay and calculate because prices were growing 150,000 % per day.

The highest inflation rate was recorded in July 1946 when the daily inflation rate reached 207%, prices were doubling in less than 15 hours. At the same time, the monthly inflation rate has reached around 42 quadrillion %.

Reasons for this hyperinflation

The country was heavily destructed as a result of WWII, infrastructure was demolished and the vast majority of manufacturers were out of business and destroyed. This left most of the population unemployed.

With no production in the country, the government had to interfere by printing more money bills, almost abolishing the tax system, increasing borrowings to banks for a small interest rate. The economy was flooded with money, which basically had no value.

The resolution

By August 1946, the government saw that the only way out of these multiple zeros in the currency was to replace the currency wholly. The Forint was introduced for the exchange of 400,000 Quadrillion Pengo.

At the same time, the country was calm after the war was over – every other reform regarding the tax and the interest rates remained the same to support the population, and the country finally stabilized.

Germany (1921 – 1924)

The inflation that the Weimar Republic has witnessed was the result of a wrong bet on the outcomes of WWI. The German emperor back then was confident that his country would win the World War, and the allies would pay reparation to boost the national economy.

Apparently, Germany lost WWI and sank deeply in one of the worst economic inflations in history. Hyperinflation led people to spend whatever money they had as soon as possible because their money would become worthless the next day.

Inflation rate

The German Mark was quite stable during the beginning of 1921 when 1 USD equaled 90 Marks. However, this stability took a different turn in the mid of 1921. Germany started printing more money bills to pay for reparation that totaled 50 billion marks as part of WWI outcomes.

During the first half of 1922, 1 USD equaled 320 German Marks. Germany continued this policy dragging its national currency deep into devaluation, by the end of 1922, 1 USD equaled 7,400 German Marks.

The effect of this devaluation was heavy on the economy as the inflation rate reached the highest in October 1923 with a rate of 29,500%, and 1 USD equaled to one trillion German Marks.

People saw the value of their money decreasing on a daily basis, as the daily inflation became more than 20%, and prices of products were doubling in less than 4 days.

To illustrate how hard the crisis was – by the end of 1922 one load of bread cost 160 Marks, however, towards the end of 1923 one loaf of bread cost 200,000,000,000 Marks.

Reasons for this hyperinflation

It all started when the then German emperor Wilhelm II overestimated the ability of his own country. He suggested that in order to prepare for the first world war, he was going to increase borrowing, rather than taxing the population.

He was confident that Germany would win the war, and that the allies would compensate for the damages. These payments would be enough to cover the funds borrowed and to stimulate the stagnating economy.

However, Germany ended up losing the war, after that, not only did Germany have to re-pay the sovereign debt, but also to pay reparation as a result of the Treaty of Versailles.

The resolution

Germany started seeking advice from economists and experts, who suggested that in order to find stability an independent central bank needed to be created. The central bank was responsible for setting the monetary policies of the country far from the political approach the state took.

In addition to that, a new currency was introduced. The Rentenmark replaced the German Mark which basically had zero value at that time. The population was called to gather the worthless German Mark to be recycled into paper.

Zimbabwe (2006 – 2008)

Zimbabwe experienced one of the worst financial breakdowns in history. The country was long dealing with civil unrest, political instability, and financial crisis by the late 1990s when the inflation started reaching 50% alarming that the worse was yet to come.

The lack of technological development and the corrupted government gave no hope to people. This led to a drop in production and overall output, but let’s see what really happened in Zimbabwe.

Inflation rate

The government responded to the lack of production by printing more money bills and the inflation rate started shooting up from being 1,281% in 2006 and became 662,000% in 2007.

This tremendous growth did not stop here, in 2008 the hyperinflation reached new highs of 79,600,000,000%, or simply saying 79 billion % monthly inflation rate.

The same applied to the exchange rate. In 2007 it went up to  ZW$30,000 for 1 USD, while the black market was selling 1 USD for  ZW$600,000. However, in July 2008, the exchange rate hit a record number when 1 USD was exchanged for ZW$758,530,000,000

The daily inflation peaked by the end of 2008 at 98%, prices were doubled every single day. At one point the loaf of bread was being sold in the black market for 10 billion Zimbabwean Dollars.

Reasons for this hyperinflation

This hyperinflation was not caused by one specific reason, rather it was the result of several reasons and situations happening in the country that spurred this economic blow-up.

The social life was not at its best, civil unrest was taking place on an ethnic and race basis, the corruption was at high levels with a score of 2.6 on the transparency index and the country ranked among the most non-transparent governments.

The national debt was increasing in the light of low output. The government started printing more money in order to cover up the debt and eventually flooded the country with currency, which devalued the currency and the whole economy.

The resolution

By that time the population started using other currencies such as the US Dollars, the South African Rand, and the Euro, and in fact, this adoption has affected the stability of the inflation rates in the country.

The country started slowly legalizing dealing in US Dollars in some markets and for some transactions, and eventually, in 2009 the government stopped printing Zimbabwean Dollars, and people had to use foreign currencies, mainly the US Dollars.

Yugoslavia (1992 – 1994)

The succession from WWII led to the formation of the Federal Republic of Yugoslavia. The republic was heavily wounded from war and the economy was suffering.

The state activities against human rights led the world to impose heavy sanctions on the republic of Yugoslavia, and this led the population into poverty. The country faced the second-worst hyperinflation in history.

Inflation rate

Several financial reforms were being carried out in the country. The government lacked the management skills and was making trial and error by introducing new reforms and new currency every year.

In 1992, the highest denomination of the newly introduced Dinar was 50,000, however, quickly in 1993 it became 10,000,000,000 Dinars.

In 1993 a new reform was introduced to replace every 1,000,000 dinars with 1 new dinar. However, that did not last so much because in 1994 another reform took place where every 1,000,000,000 dinars were exchanged for another 1 new dinar. 

Late 2014, the hyperinflation rate reached its peak at 3,130,000,000%, and a new currency was introduced – the new Novi Dinar which was exchanged for 13,000,000 Dinars.

The daily inflation at the same time was almost 65% when the prices were doubling every 1.39 days, and one loaf of bread cost 500,000,000 dinars.

Reasons for this hyperinflation

The UN imposed sanctions led the country to dark ages. Yugoslavia ran out of basic supplies. Fuel stations ran out of fuel, hospitals ran out of equipment, factories ran out of raw materials, and the average income of the population was halved.

The government tried to cover that up by printing more money and pumping it into circulation, which worsened the economic situation in the nation.

The resolution

The late introduction of the Novi Dinar was quite successful compared to the other random reforms that took place.

Later, the government adopted the “Avramović Program” economic recovery scheme. The program focused on the long-term internal stabilization of monetary policies and regulations, which drew the way out from this crisis.

Venezuela (2016 – present)

The socioeconomic situation in Venezuela, besides the wrong monetary and spending policies adopted by president Maduro, were the main reasons that escalated the inflation in the country.

Despite the country’s effort not to disclose official statistics in some years, it was obvious that the economic indicators in Venezuela were not the best, let’s see what happened there.

Inflation rate

From 2014, the country was reaching world records in inflation rates, 69% in 2014, 181% in 2015, jumping to 800% in 2016, 4,000% in 2017, and 1,698,488% in 2018. After that, the country stopped releasing official inflation figures.

It is estimated that the worst inflation rate in 2019 was 2,680,000%. At the same time, the exchange rate of 1 USD = 55,000 Bolivar Soberano or 5,500,000,000 Bolivar Fuerte which was the previous currency.

2019 was probably the worst year for the population. The minimum wage was less than the price of McDonald’s happy meal. During the first quarter of 2019, the prices increased more than 450%, and the average teacher’s salary could only afford a dozen of eggs and a couple of pounds of cheese.

Reasons for this hyperinflation

The nation was drowning in several crises at the same time, civil unrest because of bad social life, increasing unemployment rates (more than 7%), devaluation of people’s income, and price increase.

Besides that, the country had a heavily corrupted government that was spending money while the trade balance was heavily in deficit. 

By 2017, it was reported that the population lost 11 kg on average. Around 25% of the population ate two or less than two meals a day, and 90% lived in poverty.

The current state

Venezuela is still struggling with the amplified inflation rates. The country tries several methods to stimulate its economy, in 2018 a new currency was introduced, the Bolivar Soberano for the exchange of 100,000 previous currency Bolivar Fuerte.

Oil output witnessed a drop as well. Between 2015-2018 oil production declined more than 40% compared to 2013 when Venezuela was producing 2.49 million barrels a day. In 2019 output increased only to 1 million barrels a day, which is still on the minimum output that Venezuela used to produce.


Hyperinflation takes a country by a storm. As we saw in the above examples, once a state reaches an exaggerated inflation rate there is no way back unless it goes to the dead end. 

In most of the discussed scenarios, the political factor plays a huge role in worsening the country’s economical wellbeing, because in the state of war the army spending becomes a huge burden for the economy to bear.

When a government takes the approach of a “quick fix” it is unlikely to help the economy recover, rather, a state needs to take pragmatic financial decisions that are devoid of any political influence. The financial decision need to consider the internal fiscal policies and the external trade situation.