Gasoline Shortages, Wider Deficits Will Push Inflation Higher In Venezuela

• Inflationary pressures in Venezuela will increase over the coming months, driven by recurring gasoline shortages and wider public deficits.
• As a result, Fitch Solutions expects that the Bolívar Soberano (VES) will continue to depreciate in 2020 while inflation remains near the hyperinflationary territory. It forecasts the bolívar will average VES340,065.9/USD in 2020, while inflation will average 2,473.2% y-o-y.
• It also maintains its view that the current Venezuelan government, led by President Nicolás Maduro, lacks the tools to address the core drivers of inflation and currency depreciation, suggesting the situation is unlikely to change moving forward.

(Source: Fitch Solutions)