Joining ERM2, it said, would stabilise the exchange rate only if the plan to join the euro looked credible.
In April 1991, the country adopted a currency board with a fixed exchange rate regime, the Convertibility plan, which managed to curb inflation successfully: yearly inflation fell from 172% in 1991 to 25% in 1992, and from 1993 until 2001 it remained at single digit levels.
"I think people have become more sophisticated and actually consider the exchange rate in their travel plans," she said.
This can be achieved by having nominal wages fall while the exchange rate is unchanged (call it plan A), or by having wages fail to adjust to the inflationary effects of a devaluation (plan B).
Exchange rate volatility also makes it more difficult to maintain a long-term export plan.
The plan for the day was a shopping spree aimed at exploiting the exchange rate.
Venezuela's official exchange rate is set up as complicated three-tier system with rates that vary vastly depending on what Venezuelans plan to purchase.
The exchange rate may help.
