Venezuelan President Nicolas Maduro on Friday (08/17/2018) announced the only reference exchange rate pegged based on the government's virtual currency (cryptocurrency), Petro, whose value was devalued by around 96%.
Economists say the move will further exacerbate hyper-inflation in the volatile country.
In addition, several major economic reforms that will be carried out by former bus drivers and trade union leaders raise minimum salaries to more than 3,000%, increase corporate tax rates, and raise fuel prices in the next few weeks.
"I want this country to recover and I have a formula. Believe me," Maduro said in a night speech broadcast on state television, Reuters reported.
However, economists doubt that the Venezuelan government that lacks income will be able to do it. The country also faces US (US) sanctions and fails to pay its debt to state bondholders.
Venezuela will really see their wages eroded by inflation and various companies will be increasingly hit by the burden of salary increases and tax rates, economists say.
"In the midst of aggressive devaluations and monetary expansion due to salaries and bonuses, we hope hyper-inflation becomes more aggressive. All this in the context of eliminating excess non-credible money. The worst in the whole world," the Venezuelan economist at consulting firm Ecoanalitica said. Asdrubal Oliveros.
The International Monetary Fund (IMF) estimates that inflation in Venezuela will touch 1,000,000% this year.