Money & Finance › Bubbles, crashes & crises › Hyperinflation: when a currency collapses
Zimbabwe hyperinflation (2008)
2007–2009· Crisis or event
Fact, law or dataA rule, statute, definition or measured number.
Zimbabwe's currency collapsed in 2007–09, with prices doubling about every day and a 100-trillion-dollar banknote.
See it on the Money & Finance map →How it works
From 2000, President Robert Mugabe's government seized white-owned commercial farms, and farm output and exports collapsed. To pay soldiers, civil servants and debts, the central bank under Gideon Gono printed money. Official inflation hit 231 million percent a year in July 2008; economist Steve Hanke estimated 89.7 sextillion percent by mid-November. Price controls emptied shops. Three redenominations cut 25 zeros. In 2009 the government let people use US dollars and rand, and inflation stopped.
Why it matters
It is the modern proof that printing money to cover a collapsing economy destroys a currency, and that adopting a foreign one can stop hyperinflation almost overnight.
Facts, rules and data
Official statistics until mid-2008, then Hanke's estimates from parallel-market exchange rates; surviving 100-trillion-dollar notes now sell to collectors.
Debates and risks
Exact peak rates are unknowable because official data stopped; Zimbabwe's new currencies since 2019, including the gold-linked ZiG (2024), have struggled to win trust.
Connections (2)
▸Zimbabwe hyperinflation (2008) is a modern case of Hyperinflation: when a currency collapsesFact, law or data
The connection
Zimbabwe followed the classic sequence in a modern setting: land seizures crushed output and exports, the government printed money to pay its bills, people fled to dollars and goods, and the episode ended only when the currency itself was abandoned.
When and why
Zimbabwe, 2007–2009; peak monthly inflation in November 2008 was an estimated 79.6 billion percent, with prices doubling about every 25 hours.
How we know
Steve Hanke and Alex Kwok's 2009 estimates from parallel-market exchange rates; official data stopped in July 2008 at 231 million percent a year.
Debates and risks
Whether it ranks second-worst, after Hungary's 1946 episode, depends on which estimates are used, since official data stopped before the peak.
▸Zimbabwe hyperinflation (2008) ended when Zimbabweans adopted The US dollar as the world's reserve currencyFact, law or data
The connection
When no one would take Zimbabwe dollars, the government in early 2009 let people use US dollars, South African rand and other foreign money. Dollars quickly dominated, and inflation fell to single digits within months because the government could no longer print the money in use.
When and why
Zimbabwe, January–April 2009; the Zimbabwe dollar was suspended in April 2009 and formally demonetized in 2015.
How we know
Reserve Bank of Zimbabwe statements and IMF reports show prices stabilizing in 2009 after dollarization.
Debates and risks
Dollarization cost Zimbabwe its own monetary policy; its 2019 return to a local currency revived inflation, and rebuilding trust remains unresolved.