Shenyang, China -- In a surprise move, the North Korean central bank has revalued and replaced its national currency as of today, according to several sources.
One source relayed that from 2 P.M. the old paper currency started being exchanged for a new one, while another source from Pyongyang claimed that the switch began at 11 A.M.
The exchange rate for the new currency is 100:1, so old 1,000 won bills are being exchanged for new ten won bills.
Regarding the purpose behind the currency reform, one source suggested, “It looks like an attempt to control inflation, but it may have the side effect of making consumer reliance on dollars or Yuan rise due to a loss of confidence in the value of the North Korean currency.”
Another source agreed, “Since the July 1st Economic Management Reform Measure in 2002, prices have skyrocketed. Since Chosun (North Korea) money has lost its value, the authorities have undertaken this currency reform.”
The North Korean authorities convened urgent meetings this morning to distribute information on how the currency should be exchanged.
A source in North Hamkyung Province told The Daily NK, “This morning, there was a decree to people’s units. When the news spread in the jangmadang, people panicked.”
A Sinuiju source reported, “Traders gathered around currency dealers. Chaos ensued when currency dealers tried to avoid them.”
Dandong and Yanji, bases for smuggling into North Korea, were also full of confusion.
Choi, a Korean-Chinese trader in Dandong said, “All trade with North Korea ceased. Telephone lines are busy now with North Korean dealers trying to obtain Yuan.”