Monetary history

Hyperinflation: Weimar, Hungary and Zimbabwe

Hyperinflation is more than a period of high annual inflation. Prices rise so quickly that holding money even briefly can become costly, disrupting everyday trade and savings.

By The Golden Dow · Last updated October 14, 2026 · Editorial policy

What counts as hyperinflation?

Hanke and Kwok's 2009 study adopts Phillip Cagan's threshold of a price-level increase of at least 50 percent per month. Its figures compare monthly rates, equivalent daily rates and the time required for prices to double. A monthly percentage must not be read as an annual figure. [2]

Weimar Germany: the 1923 crisis

The Bundesbank traces Germany's inflationary financing to World War I: gold redemption of banknotes stopped, borrowing increased and the Reichsbank issued more money. After the war, domestic debt, social spending and reparations added to fiscal pressure. The money supply expanded without matching growth in goods. [1]

By 1923, wages could be paid daily and traders raised prices repeatedly. Some transactions shifted toward goods such as food and coal. Currency reform introduced the Rentenmark in November 1923 after mark-denominated financial claims had lost much of their value. This account describes monetary and fiscal mechanisms; it does not reduce Germany's later political history to a single cause. [1]

Hungary: peak inflation in July 1946

Table 2 of Hanke and Kwok reports Hungary's highest monthly inflation rate as 4.19 × 10¹⁶ percent in July 1946, with an equivalent price-doubling time of 15 hours. Their historical comparison places Hungary above Zimbabwe. The doubling time summarizes the peak pace; it does not mean every individual item's price changed on that exact schedule. [2, Table 2]

Zimbabwe: an estimate, not a complete official series

Hanke and Kwok estimate a peak monthly inflation rate of 79.6 billion percent in mid-November 2008, corresponding to prices doubling in about 24.7 hours. Official inflation reporting had stopped before the final explosive months. The researchers therefore inferred inflation using exchange-rate information, purchasing-power parity and prices of Old Mutual shares listed in both London and Harare. [2, Tables 1–2]

The study describes foreign currencies replacing the Zimbabwe dollar and subsequent price stabilization. Its extraordinary peak number should be attributed to that estimation method, not presented as an unqualified official statistic or a current forecast. The paper was published by the Cato Institute, a policy organization; its authors' interpretations are distinct from the numerical estimates. [2]