When inflation increases sharply, it is called hyperinflation. A month-on-month increase in commodity prices of more than 50 percent is considered hyperinflation. This weakens the value of the local currency.
A look at history shows that many countries have suffered catastrophic collapses in the past due to inflation. But this high inflation was mostly due to war.
Around 1922, Germany experienced hyperinflation as a result of World War I. At that time, the Allies occupied an industrial area in Germany and seized all the goods produced there.
Then printing extra money weakens the value of the local currency. The excessive printing of currency caused the prices of daily essentials including bread and eggs to rise drastically. In 1944, Germany and Russia waged war between Hungary.
There Germany and Russia faced each other. As a result, many industrialized areas within Hungary were destroyed and production capacity decreased. Both Germany and Russia took away much of Hungary’s wealth.
As a result, the Hungarian people saw the worst inflation in history. They have never been in such a difficult situation in the economic field before. As the prices of daily necessities and food keep increasing, it creates a situation like anarchy and chaos.
Poor and middle class people buy products from black market. Hungary has been hit hardest by inflation. But currently they are in a much better position.