José Gregorio Yépez
Economists who follow Venezuela closely agree that the U.S. dollar exchange rate plays a central role in shaping the country’s current economic reality.
Price behavior in Venezuela remains closely tied to fluctuations in the value of the U.S. currency in the local market. As a result, maintaining exchange-rate stability has become a key priority.
The dollar dominates conversations across the country and likely stands as the most common topic in everyday life. “How much does that cost?” and “In cash dollars or bolívars?” have become routine questions.
Because the dollar shapes daily life, people constantly monitor its value. Its fluctuations influence decisions at every level of society. From major oil executives to parking attendants working on “hunger street,” everyone feels the impact of this economic variable.
Economists have proposed different solutions. Asdrúbal Oliveros stresses the need to intervene in the parallel market, while José Guerra advocates an exchange-rate anchor combined with a domestic monetary anchor.
What Has Happened?
Since the beginning of the year, the local currency has lost 45.9% of its value against the dollar in the official market.
In May alone, the official exchange rate climbed 11.79%, moving from 487.11 bolívars per dollar at the end of April to 544.57 bolívars per dollar on the final trading day of May.
The dollar gained 57.46 bolívars during just 13 effective trading days in May.
A broader view reveals an even sharper increase. Between the final trading day of 2025 and the opening of the market on Monday, June 9, the dollar gained 272.72 bolívars, or 92.45%, nearly doubling its value since the start of 2026.
According to the consulting firm Aristimuño, Herrera y Asociados, the Central Bank of Venezuela (BCV) injected $5.774 billion into the foreign-exchange market during the first five months of 2026, far above the $3.154 billion it allocated during all of 2025.
Despite this aggressive intervention strategy, the national currency has continued to lose value.
Intervening in the Parallel Market
Economist Asdrúbal Oliveros argues that the main problem in Venezuela’s foreign-exchange market stems from the gap between the official exchange rate and the parallel rate.
“That gap creates serious distortions in the economy because businesses must price goods at the official rate, yet they cannot obtain dollars at that rate,” he explains.
In comments shared on social media, Oliveros argues that policymakers must focus on narrowing the exchange-rate gap. However, he acknowledges that the differential has declined somewhat compared with levels recorded earlier this year.
“The Venezuelan state urgently needs a strategy that injects supply and liquidity into the parallel market and helps narrow the gap,” he states.
Oliveros then highlights the importance of the alternative currency market, noting that it serves a large number of participants, particularly small and medium-sized businesses, merchants, entrepreneurs, and informal workers.
“Many of these actors do not receive services from the national banking system. As a result, they seek dollars in this market, and when supply falls short, prices rise,” he says.
He argues that authorities should not focus exclusively on providing foreign currency through BCV interventions that satisfy demand from large corporations, formal businesses, and strategic sectors.
“We must also support this smaller and more informal economic structure. That approach can help narrow the gap and generate broader benefits for the population,” the economist concludes.
Venezuela Needs an IMF Agreement
When asked about the issue, José Guerra responds directly: “The task today is to solve the dollar problem. As long as there are three exchange rates, the country will not solve this issue. The situation has driven merchants crazy.”
Guerra criticizes BCV policy and argues that it relies too heavily on devaluation.
“The proper course involves narrowing the gap with the parallel market and establishing a realistic dollar price. The official rate does not truly exist in practice, yet authorities require merchants to follow it,” he says.
He proposes what he calls “an exchange-rate anchor and a domestic monetary anchor.”
“If authorities keep creating bolívars out of thin air through BCV financing for PDVSA, people will use those bolívars to buy the cheap dollars that the BCV sells. Those who cannot obtain them will buy dollars at any price. The problem is not an expensive dollar; the problem is a scarce dollar,” the university professor argues.
Guerra also emphasizes the need for an agreement with the International Monetary Fund. He believes Venezuela should seek a $10 billion disbursement to strengthen international reserves and stabilize the exchange rate.
Results Versus Statistics
Recent BCV data show slower inflation. The central bank reported a monthly inflation rate of 6.3% in May, the lowest level in 19 months. Nevertheless, ordinary citizens do not perceive that improvement.
This disconnect represents the government’s main challenge: turning macroeconomic indicators into tangible results.
The dollar remains the main character in this story. Unfortunately, no crystal ball can reveal the ending. For now, Venezuelans keep their feet on the ground as they confront the country’s economic, political, and social reality.
The game continues.
