People holding US dollar banknotes and Venezuelan bolívar banknotes. Photo: Juan Barreto/AFP/Getty Images/File photo.
Commercial transactions in bolívars in Venezuela increased in February of this year while transactions in US dollars recorded their lowest monthly level since June 2019. This was highlighted in the most recent report issued by Ecoanalytica, cited by the platform Banca y Negocios.
The use of bolívars [Venezuela’s national currency] represented 54.9% of the transactions, which is equivalent to an increase of 7.6 percentage points compared to the last report. Dollars were used for 32.7% of transactions (9.6 percentage points less than the last report).
Venezuela has experienced a decrease in recent months in inflation, which has caused the bolívar not to depreciate. In April 2024, according to the Central Bank of Venezuela, the Intermonthly Variation of the National Consumer Price Index (INPC) was 2%, which represents the lowest inflation in 12 years.
The financial institution indicated in a press release that as a result of that month, the accumulated inflation during 2024 stood at 6.3% in the first quarter, the lowest in the last 12 years for a similar period.
According to Ecoanalítica, an economic consulting firm with more than 20 years of experience, the cities and entities where most transactions in dollars occur in Venezuela are the regions of San Cristóbal, on the border with Colombia, (79.8%), Nueva Esparta (68.5%), and Lecherías (65.9%), although, on average they show a decrease of 6.4 percentage points in dollarization rates with respect to the previous report. Mérida showed the lowest rate of dollarization (16.3%), followed by Caracas (34.1%).
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Venezuela fell three places in the dollarization ranking, below the average of the last three studies (45.6%). Dollarization rates were also below 50% in Maracay (44.6%), Valencia (41%), and Barquisimeto (41%), among other regions.
According to data collected by Bloomberg, trade in automotive spare parts in Venezuela is the most dollarized (81.2%), while the lowest rate of dollarization is found in personal care products (39%), health (40.6%), and food (44.2%).
November of last year closed as the month with the lowest dollarization of bank deposits in 2023, given that the consolidated balance of foreign currency accounts represented 46.3% of total deposits, according to a report from the consulting firm Aristimuño Herrera & Asociados.
The head of state, Nicolás Maduro, said on May 6 of this year that the new economic model that is being built in the country requires three fundamental elements to continue moving forward, according to the Presidential Press: first, the growth of the real economy and production of what the nation requires. Second, the balance of the exchange system and repositioning the currency with a new exchange system. Third, real deceleration of inflation.
Translation: Orinoco Tribune
OT/KW/SL
