Los Angeles, January 17, 2017 (venezuelanalysis.com) – Venezuelan Central Bank (BCV) Director José Khan confirmed that the country’s new higher denomination bank notes had entered into circulation on Monday.
Distributed to banks across the nation, Venezuelans began to acquire and use 500, 5,000 and 20,000 bolivar bills – amounting to three of the new six banknotes that will ultimately be incorporated into the Venezuelan economy. The remaining 1000, 2000 and 10,000 notes will be progressively integrated into the country’s monetary system at a later date, say government sources.
“The first reports that have arrived about the circulation of our new currency are positive…We’re moving little by little,” stated President Nicolás Maduro Monday evening.
On January 9th, President Maduro announced the bills would begin circulating this week following intense speculation over the holiday period. The new banknotes were originally meant to enter into usage in mid December, however the date was pushed back by the president after cargo planes carrying the new tender failed to arrive.
According to the Bolivarian government’s official exchange rate, 20,000 bolivars is equivalent to USD $30. However, at the black market rate of approximately 3,000 bolivars to the US dollar, 20,000 bolivars comes in at just under USD $7.
The bills are aimed at offsetting the consequences of the country’s skyrocketing inflation rates, which have decimated the value of Venezuela’s highest value 100 bolivar banknote. The South American country also launched a new currency regime in 2008 with the aim of combat growing inflation.
Maduro first announced a recall of Venezuela’s 100 banknote in December and the introduction of new currency for 2017. Venezuela’s latest currency includes six new bills and three coins.