By law, the Central Bank of Venezuela is autonomous to formulate and exercise policies in its field of competence and it performs its duties and functions in coordination with the general economic policy. The Constitution grants the central bank autonomy to outline and implement the policies. However, as of 2016, reforms deemed unconstitutional by some effectively nullified the BCV's independent status. The export, import or trade of Venezuelan or foreign currency are subject to the regulations established by the BCV, including the departure or arrival of coin and notes made by another countries by BCV's express order.
Foreign reserves
Since its inception in the late 1930s, the BCV was given a clear mandate to control the monetary policy of the nation, centralizing the operations of a handful of private banks that used to mint the Venezuelan currency, the bolívar. For almost 50 years the BCV managed to sustain a remarkable strong currency, with inflation rates hovering on the 2-3% mark during that period. However, since the oil glut of the 1980s and the first serious devaluation of the currency in 1983 the bolívar has been plagued with chronic instability, mistrust and declining value that has been fed by the continued rise in inflation, topping an estimate for 2018 of one million per cent. Most of the foreign reserves are held as gold bars in Germany.
System for Transactions with Foreign Currency Securities
The Central Bank is able to issue bonds through the System for Transactions with Foreign Currency Securities. In 2012, it was reported that $44 million worth of bonds were purchased through SITME in a single day for Petróleos de Venezuela, S.A..
Sicad
Until 2015 the Supplementary System for the Administration of Foreign Currency operated as an alternative foreign exchange system for businesses and individuals. Given its ineffectiveness and the continued rise of the parallel exchange rate the system was discontinued in favor of the "Complementary Currency System", known for its Spanish acronym DICOM.
Hyperinflation
Since December 2017 Venezuela the CPI has presented a behavior that fits most of the definitions for hyperinflation, the first in the country's history. The bank, subject to a strong control by the executive branch of the Venezuelan government, has ceased the publication of metrics such as the CPI and gross domestic product variation, creating a vacuum that has left investors and the public on a general state of disarray.
Controversy
Sanctions
In April 2019, the U.S. Treasury Department sanctioned the Central Bank of Venezuela "to prevent it from being used as a tool of the illegitimate Maduro regime."
