Venezuela’s FX changes get tentative approval from analysts

Venezuela’s FX changes get tentative approval from analysts

Economy & Policy Corporate & Sovereign Strategy

Sicad II, Venezuela’s new foreign exchange regime, has been greeted with cautious optimism by analysts who say it could cut the country’s deficit. The new law, announced last week, makes it legal to buy and sell dollars privately. The move could result in an average exchange rate of 25 to 40 VEF to the dollar, a devaluation of 43% to 57%, according to economists at Bank of America Merrill Lynch. That could lower the 2014 deficit to 9.2% to 3.2% of GDP — from around 14.4% at the current average e

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