Breaking: Venezuela devalues its currency by 70%
By Daniel at 11 January, 2010, 6:03 pm
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And Fitch rating agency responded by saying that wasn’t
enough to deal with their financial problems…Dow Jones
Actually, this is real big news and should have made headlines across the board today! I would think this is the first recent country among many others to follow down this road too! This news does not bode well for the trading level of the DOW this week!
“Venezuela’s decision to devalue the Bolivar culminates an event that the market has been anticipating for a long time,” said Walter Molano, an analyst at BCP Securities. “It helps alleviate the country’s fiscal woes and puts it on a sounder macroeconomic footing.”
The measure is a relief for state oil company PDVSA, which has struggled to pay service providers and meet requirements to fund social projects since crude prices dropped sharply last year. It also makes Venezuelan businesses more competitive.
Holders of Venezuela’s foreign debt are also pleased, since the devaluation improves government finances and lessens the need to issue more bonds.
Read more:
http://www.reuters.com/article/idUSN096521320100109
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