Bloomberg.com: Venezuela Bolivar Slides as Vielma Threatens to Punish Traders

リンク: Bloomberg.com: Latin America.

Venezuela Bolivar Slides as Vielma Threatens to Punish Traders

By Guillermo Parra-Bernal

Jan. 26 (Bloomberg) -- Venezuela's bolivar weakened to a record low in unregulated trading after Tax Chief Jose Vielma Mora said traders caught buying and selling dollars out of the legal government channel will be ``severely'' punished.

``Exchange houses, banks and travel agencies irresponsibly support foreign exchange crimes,'' Vielma said in a televised news conference in Caracas. ``We have to be very severe with people who are committing these crimes.''

Vielma's comments come a day after Finance Minister Rodrigo Cabezas called for more aggressive measures to rein in illegal foreign exchange trading, underscoring the government's growing concern that a tumble in the currency in the unregulated market will add to an inflation surge. Venezuelans turn to the unregulated market when they don't get authorization from the government to buy dollars at the official exchange rate.

The currency fell 3.4 percent to 4,600 bolivars to the dollar -- 53 percent weaker than the official rate of 2,150 per dollar -- from 4,450 yesterday, traders said. It's weakened about 32 percent since this year, driven lower by a decline in oil, the country's biggest export, and by President Hugo Chavez's plans to nationalize telephone and electric utilities.

``There's a lot of uncertainty in the marketplace over how these more severe controls will be implemented,'' said Marjorie Hernandez, an economist with HSBC Securities USA Inc. in New York.

Inflation Surge

Vielma said the government created a commission to investigate the different forms of trading in the unregulated market. The commission will be formed by lawmakers, the consumer protection agency and prosecutors and the Foreign Exchange Administration Commission, he said.

The National Assembly is also investigating, at the request of Chavez, unregulated foreign exchange markets that are helping bend currency controls he imposed in 2003.

The government is also considering measures to try to limit the parallel exchange rate's impact on consumer prices, Cabezas said. Many businesses use the parallel bolivar rate as a reference to set the price of goods in Venezuela.

Annual inflation soared to 17 percent in December, the highest rate in Latin America, from 10.4 percent in May after Chavez used record oil proceeds to boost government spending by 56 percent in the first 10 months of last year.

``It's hard to think that tougher controls may ease inflationary pressures,'' Hernandez said.

Government bonds that offer some currency-risk protection gained today. The yield on the 6.25 percent dollar-denominated bond due April 2017, known as TICC, fell for a third consecutive day to 3.94 percent compared with 4 percent yesterday, according to Mercantil Servicios Financieros CA. The price, which moves inversely to the yield, rose to 119.45 centavos from 118.90 yesterday.

To contact the reporter on this story: Guillermo Parra-Bernal in Caracas at gparra@bloomberg.net

Last Updated: January 26, 2007 16:10 EST