Amid crisis, Venezuelans commemorate two years of Hugo Chavez's death

Early morning fireworks burst over Venezuela's capital on Thursday for a commemoration of Hugo Chavez on the second anniversary of his death, even as an economic crisis threatens to undo the former president's legacy of lifting many out of poverty.

Mourners were expected to gather later in the day at his tomb in a former military barrack perched atop a hillside slum. Chavez died in 2013 after a long battle with cancer, but the exact nature of the cancer has never been revealed.

While Chavez is still revered by many poor Venezuelans, support for his hand-picked successor, Nicolas Maduro, has been plunging almost as quickly as the price of oil on which the economy depends.

The economy has for months been suffering from widespread shortages of basic goods that contributed to 68 percent inflation last year, the highest in the world. And poverty, which had fallen under Chavez, has been steadily rising even before the economy started to contract last year, according to the United Nations.

More bad news could be on the way, with analysts pointing to a precipitous drop of the nation's currency on the black market as a sign that inflation could hit triple digits soon.

The so-called "strong bolivar" created by Chavez in 2007 weakened to a record low 260 per U.S. dollar on Thursday, according to DolarToday, a website which says tracks the black market rate based on currency trades along the Colombian border. It's fallen more than 35 percent in the past two weeks, according the website.

"Three days ago the dollar at 220 was considered too expensive and now it's cheap," said Jose Guerra, a former central bank researcher

Driving the currency volatility is the apparent failure by the government's new currency system to meet demand for greenbacks. Last month, the government unveiled what it said would be a free-floating exchange rate where individuals and businesses could buy dollars when unable to obtain them at the tightly controlled preferential rates reserved for import priority imports.

But obtaining dollars at the new so-called Simadi rate, now at 176 bolivars per dollar, has proven elusive.

As Maduro's approval ratings have dipped into the low-20-percent range, he has leaned ever more heavily on the legacy of the popular predecessor.

The socialist government has rolled out a type font based on Chavez's handwriting, and this winter it debuted a ballet based on the revolutionary leader's life. Chavez's portrait in a red beret is still seen on innumerable buildings. His words and his rendition of the national anthem can still be heard daily on television.

Even when the Chavez highlight reel isn't playing, Maduro features photos of the late leader at nearly all official events. He once said he'd spotted his mentor in the form of a little bird.

Chavez tapped the world's biggest oil reserves to aid the poor during his 14 years in office, and poverty fell from nearly 50 percent in 2002 to less than 30 percent in 2011, according to the United Nations Economic Commission for Latin America. But the same organization in a January report said poverty levels rose from 25 percent in 2012 to 32 percent in 2013. More than 1 million people are believed to have fallen back into poverty in the two years since Chavez's death, according to a recent survey by three Caracas universities.

Isabel de Perales, a 68-year-old housewife in a staunchly pro-Chavez neighborhood in western Caracas, said the situation would never have deteriorated under El Comandante.

"When Chavez was around things were better," she said while waiting in line under a piercing sun to enter a grocery store. "I don't know what's wrong with Maduro but the situation is grave."

Based on reporting by the Associated Press.