Bic Mac Index: Bolivar 40% undervalued

May 3, 2003

The Economist just came out with its usual Bic Mac index for currencies (via PostPolitics). The Venezuelan currency the Bolivar is reported to be 15% undervalued, except that they are using the official rate, which essentially does not exist. After 100 days of currency controls not a single importer has been given foreign currency at the official rate. Thus, using the parallel rate of Bs. 2300 per US dollar the currency is 40% undervalued. Way to go Hugo!

This entry was posted on May 3, 2003 at 11:32 pm and is filed under Venezuela.

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