"Arguably the biggest problem facing Venezuelans in their day-to-day lives is hyperinflation. The annual inflation rate reached 83,000% in July, according to a recent study by the opposition-controlled National Assembly.
Prices have been doubling every 26 days on average. This has resulted in many Venezuelans struggling to afford basic items such as food and toiletries.
With small items like a cup of coffee costing a whopping 2.5m bolivars until recently, it also became increasingly difficult to pay for goods in cash.
Until the currency's redenomination on 20 August, Venezuelans needed 25 of their highest denomination notes - the 100,000 bolivar bill - to pay for their caffeine fix.
Venezuela is rich in oil, and has the largest proven reserves in the world. But arguably it's this exact wealth that underpins many of its economic problems.
Because it has so much oil, Venezuela has never bothered to produce much else. It sells oil to other countries, and with the dollars it earns, imports the goods Venezuelans want and need from abroad.
Its oil revenues account for about 95% of its export earnings. But when the oil price plummeted in 2014, Venezuela was faced with a shortfall of foreign currency.
This in turn made it difficult to import goods at the same level as before, and imported items became scarcer.
The result: businesses increased prices and inflation rose.
Add to that the government's willingness to print extra money and regularly hike the minimum wage in an effort to regain popularity with Venezuela's poor, and you get money which loses its worth rapidly.
The government is also increasingly struggling to get credit after it defaulted on some of its government bonds.
With creditors less likely to take the risk of investing in Venezuela, the government has again taken to printing more money, further undermining its value and stoking inflation.
What's the government doing about it?
The government lopped five zeros off the old "strong bolivar" currency on 20 August and gave it a new name - the "sovereign bolivar".
It also began circulating eight new banknotes worth 2, 5, 10, 20, 50, 100, 200 and 500 sovereign bolivars and two new coins.
The new currency is part of an "economic package" of measures which the government says is the "magic formula" to help Venezuela's battered economy recover.
Among the measures are:
Raising the minimum wage to 34 times its previous level from 1 September
Anchoring the sovereign bolivar to the petro, a virtual currency the government says is linked to Venezuela's oil reserves
Curbing Venezuela's generous fuel subsidies for those not in possession of a "Fatherland ID"
Raising VAT by 4% to 16%
How are people reacting?
Many people have been voting with their feet and leaving Venezuela. According to United Nations figures, 2.3 million Venezuelans have left the country since 2014 when the economic crisis started to bite.
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