Oct. 15 (Bloomberg) -- JPMorgan Chase & Co. cut its 2009 economic growth forecast for Venezuela to 2.5 percent from 3.5 percent on lower oil prices and expectations of a global recession.

Should oil prices remain below $90 next year, Venezuela's current account surplus, expected to close the year at 14 percent of gross domestic product, could move into a deficit in 2009, analyst Ben Ramsey wrote in a report published today.

JPMorgan expects a 30 percent devaluation of the bolivar in 2009 to 2.75 bolivars per dollar, from the current peg of 2.15. While politically unpopular, a devaluation would ``help relieve the pressure on the fiscal deficit, and the magnitude of this projected devaluation may increase depending on how low oil prices ultimately go,'' Ramsey wrote.

Venezuela, the largest oil exporter in the Americas, depends on oil sales for about 50 percent of government revenue and petroleum products represent more than 90 percent of exports. President Hugo Chavez has used record-high oil prices to expand state control over the economy and finance a surge in consumer spending through government jobs and social programs.

The government's plans to repurchase debt have been put on hold because market turbulence is making new foreign currency debt issuances to local investors unattractive, the report says. The government may opt to use money in the off-budget National Development Fund to pay for recent nationalizations of the cement industry and a local bank unit of Spain's Banco Santander SA, valued at about $3 billion, instead of buying back debt, Ramsey wrote.

The government's proposed 2009 budget forecasts an average price for Venezuelan oil of $60 a barrel and economic growth of 6 percent with no plans to devalue the bolivar, lawmaker Ricardo Sanguino said in an interview yesterday.

The budget will formally be presented next week by Finance Minister Ali Rodriguez, Sanguino said.

To contact the reporter on this story: Daniel Cancel in Caracas at dcancel@bloomberg.net.

Last Updated: October 15, 2008 12:05 EDT