Hiperinflação recorrente e estabilização na Nicarágua

Abstract

This paper analyzes the conditions leading to recurrent hyperinflation in Nicaragua in the late 1980s and early 1990s. Massive fiscal credit and balance of payments imbalances became a dominant feature of Nicaragua soon after the victory of the Sandinistas in 1979. Inflation followed with significant initial lag. A series of massive adjustment programs were adopted since 1988 to correct existing disequilibria. The attempt to correct exchange rate overvaluation without a consistent monetary and fiscal policy led to a first wave of hyperinflation in 1988. he 1989 stabilization program significantly reduced the inflation rate, but was abandoned soon after the electoral defeat of the Sandinistas in February 199a Renewed fiscal and monetary imbalances, together with strong trade union resistance and increasing dollar indexation were the background for a second wave of hyperinflation in 1990, now under the Chamorro administration.