page_title: Hyperinflation
section_title: Yugoslavia
hierarchical_section_title: Hyperinflation / Notable hyperinflationary episodes / Yugoslavia
caption_attribution_description: Русский: Банкнота номиналом 500&#160;000&#160;000&#160;000 югославских динаров с изображением Йована Йовановича (Змая)English: 500,000,000,000 Yugoslav dinar banknote, featuring image of Jovan Jovanovic Zmaj
context_page_description: In economics, hyperinflation is very high and typically accelerating inflation. It quickly erodes the real value of the local currency, as the prices of all goods increase. This causes people to minimize their holdings in that currency as they usually switch to more stable foreign currencies, in recent history often the US dollar. Prices typically remain stable in terms of other relatively stable currencies.
  Unlike low inflation, where the process of rising prices is protracted and not generally noticeable except by studying past market prices, hyperinflation sees a rapid and continuing increase in nominal prices, the nominal cost of goods, and in the supply of currency. Typically, however, the general price level rises even more rapidly than the money supply as people try ridding themselves of the devaluing currency as quickly as possible. As this happens, the real stock of money decreases considerably.
  Hyperinflation is often associated with some stress to the government budget, such as wars or their aftermath, sociopolitical upheavals, a collapse in aggregate supply or one in export prices, or other crises that make it difficult for the government to collect tax revenue.
context_section_description: Yugoslavia went through a period of hyperinflation and subsequent currency reforms from 1989 to 1994. One of several regional conflicts accompanying the dissolution of Yugoslavia was the Bosnian War (1992–1995). The Belgrade government of Slobodan Milošević backed ethnic Serbian forces in the conflict, resulting in a United Nations boycott of Yugoslavia. The UN boycott collapsed an economy already weakened by regional war, with the projected monthly inflation rate accelerating to one million percent by December 1993 (prices double every 2.3 days).
  The highest denomination in 1988 was 50,000 dinars. By 1989 it was 2,000,000 dinars. In the 1990 currency reform, 1 new dinar was exchanged for 10,000 old dinars. In the 1992 currency reform, 1 new dinar was exchanged for 10 old dinars. The highest denomination in 1992 was 50,000 dinars. By 1993, it was 10,000,000,000 dinars. In the 1993 currency reform, 1 new dinar was exchanged for 1,000,000 old dinars. Before the year was over, however, the highest denomination was 500,000,000,000 dinars. In the 1994 currency reform, 1 new dinar was exchanged for 1,000,000,000 old dinars. In another currency reform a month later, 1 novi dinar was exchanged for 13 million dinars (1 novi dinar = 1 German mark at the time of exchange). The overall impact of hyperinflation was that 1 novi dinar was equal to 1 × 10²⁷ – 1.3 × 10²⁷ pre-1990 dinars. Yugoslavia's rate of inflation hit 5 × 10¹⁵% cumulative inflation over the time period 1 October 1993 and 24 January 1994. 
  First episode:
  Start and End Date: Sept. 1989 – Dec. 1989
  Peak month and rate of inflation: December 1989, 59.7%
  Second episode:
  Start and end date: April 1992 – January 1994
  Peak month and rate of inflation: January 1994, 3.13×10⁹%
caption: A 500 billion Yugoslav dinar banknote circa 1993, the largest nominal value ever officially printed in Yugoslavia, the final result of hyperinflation.
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