Start America Venezuela allows a parallel exchange rate system

Venezuela allows a parallel exchange rate system

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In the middle of the political crisis in Venezuela, the central bank has approved a parallel exchange rate system. Since yesterday, the private money house Interbanex can handle foreign exchange transactions in the socialist country.

On the first day of trading, the bank set the exchange rate at 3,200 bolivars per dollar. This meant a devaluation of just under 35 percent over the official exchange rate of the central bank of 2,084 bolivars per dollar. The Interbanex price roughly equals the black market price. The exchange rate will in future determined by supply and demand, the company said.

Power struggle between government and opposition

Venezuela is in a deep economic crisis. For the current year, the International Monetary Fund (IMF) expects an inflation rate of 1.37 million percent, the gross national product is expected to fall by another 18 percent according to the forecast.

In addition, a power struggle is raging in the South American country between the government and the opposition. Parliament leader Juan Guaido has declared himself interim president and wants to push President Nicolas Maduro out of office. The US and many Latin American countries already recognized him. Maduro speaks of a coup against his socialist government.