Venezuela Economic Outlook
January 21, 2020Economic conditions likely continued to deteriorate in the fourth quarter of last year but seemingly at a less severe rate. Oil production rose modestly in October–November after three months of decline, although it was still down more than 40% since the start of 2019 as U.S. sanctions and power outages choked the industry. In turn, authorities have considered allowing foreign capital into PDVSA-led joint ventures as a way of reviving the sector. The dubious appointment of Luis Parra as head of the National Assembly on 7 January reflected the government’s desire to control the assembly in order to draft a law that would allow foreign businesses to run day-to-day oil operations in the country. In addition, a law was passed by presidential decree on 26 December that gives importing firms six months of tax privileges, further suggesting the government is loosening its grip on the economy in an attempt to resuscitate economic activity.
Venezuela Economic GrowthThe economy is seen contracting for a seventh year running in 2020, albeit less severely. Easing government regulation should aid private consumption, although shortages are likely to persist amid a lack of hard currency. Meanwhile, oil production looks set to stabilize at current levels, provided no further sanctions are introduced. Some of our analysts may have factored in the possibility of a privatization agenda going forward. As it stands, the Consensus projects the economy contracting 10.4% in 2020, which is down 2 percentage points from last month’s forecast. In 2021 the panel sees GDP falling 1.5%.
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|Bond Yield||5.50||0.0 %||Aug 19|
|Exchange Rate||248,832||0.0 %||Aug 17|
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Venezuela Economic News
October 19, 2019
On 19 October, the Central Bank of Venezuela (BCV) released fresh macroeconomic data for the first time in six months, underscoring the severity of the crisis currently gripping the country.
Venezuela: Inflation eases to seventh-month low in September amid Central Bank’s contractionary policies
October 19, 2019
National consumer prices surged 52.2% from the previous month in September, up from August’s 34.6% month-on-month jump according to the trove of data released by the Central Bank of Venezuela (BCV) on 19 October.
June 10, 2019
National consumer prices jumped 33.8% from the previous month in April, following March’s 34.8% month-on-month surge, according to the trove of data released by the Central Bank of Venezuela (BCV) on 28 May.
May 28, 2019
On 28 May, the Central Bank of Venezuela (BCV) released macroeconomic data for the first time in nearly four years, highlighting the extent of the profound economic crisis currently gripping the country.
May 14, 2019
The Venezuelan bolívar soberano was sharply devalued, yet again, by the Central Bank (Banco Central de Venezuela, BCV) on 22 April.