Libyan currency crisis worsens with fake notes, inflation and growing public mistrust

Libya's economy is grappling with a serious currency crisis as counterfeit banknotes flood the market. The central bank has recalled 50-dinar notes, citing concerns over fake currency entering circulation. These counterfeit notes, printed in Russia and linked to warlord Khalifa Haftar's eastern-based government, have severely undermined the Libyan dinar's value. With the official exchange rate at 5.4 dinars to the US dollar, the black market rate has soared to around 8 dinars, causing rapid inflation and making basic goods unaffordable for many citizens.
The central bank estimates that over $650m worth of unregistered 50-dinar notes were received during the recall, out of nearly $2bn printed in Russia. As the bank now moves to recall 20-dinar notes, experts warn that absorbing this currency as public debt could further weaken the dinar and exacerbate inflation. For ordinary Libyans already struggling with rising prices, the economic outlook appears increasingly dire.

Al Jazeera's Malik Traina reports from Misrata, Libya.

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