CARACAS, Jan. 8 (Xinhua) -- Venezuelan President Hugo Chavez announced a dual exchange rate mechanism for the country's currency on Friday, devaluing it for the first time since 2005.

    Chavez said the bolivar will have two different exchange rates for different transactions: 2.6 bolivars for one U.S. dollar for priority transactions and 4.3 bolivars for other dealings.

    The bolivar will devalue by 17 percent for priority transactions and 50 percent for ordinary transactions compared with the currency's 2.15-bolivar peg to the U.S. dollar since 2005.

    The devaluation of the currency is seen as a measure to curb the skyrocketing inflation amid an economic recession.

    Venezuela's inflation rate of 25.1 percent in 2009 topped every other Latin American nation, said the country's central bank on Thursday.

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