Venezuela continues to struggle with rising prices for U.S. currency as President Hugo Chavez steps up his plans for what he describes as a new socialism through a controversial constitutional reform.

In the unofficial foreign currency market, the dollar managed to reach 4,850 bolivars on Monday, more than twice the official rate and yet another record level according to the Web site of local business publication Veneconomia.

The dollar's unofficial exchange rate against the bolivar jumped early this month, right after the finance ministry decided to postpone the Bond of the South III sale - a joint debt issue with Argentina - due to market volatility. Chavez set capital controls in 2003 and has since limited the amount of dollars people can obtain through the government, a policy that has spawned a thriving black market for dollars.

"What we have here is a structural problem, not just a matter of a failed bond issue," said Joaquin Vera, head of local brokerage Interbursa. "There's an underlying issue of a loss of confidence."

The president has proposed a sweeping constitutional reform, including areas that underpin the entire economy. His plan to add new property ownership structures makes many people fee uneasy. This has created a certain degree of uncertainty among Venezuelans, traders say.

In addition, Chavez has vowed to strike three zeros from the currency in a bolivar redenomination planned for Jan. 1, another policy that makes many people here nervous.

Chavez has made clear his administration has no plan to scratch capital controls and has every intention of leaving the official rate of VEB 2,150 to the dollar unchanged next year.

Meanwhile, Venezuelans are using any trick to squirrel away as much money as they can in foreign bank accounts. Those who can afford it buy dollar- denominated debt sold by the finance ministry and resell the bonds overseas for cash.