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Venezuela President Hugo Chavez gave a preview Thursday of new limits on the prices of many consumer goods in the country by unveiling lower prices on brands of bottled water and deodorant.

A five-liter bottle of water sold locally by Coca-Cola Femsa SAB (KOF, KOF.MX), Latin America's largest Coke bottler, will see its average price cut nearly in half to a fixed 12.45 bolivars, or about $2.90.

Chavez added that a deodorant marketed by Procter & Gamble Co. (PG) will be lowered by 24% to 13.50 bolivars or $3.14.

"We are not asking (companies) to lose money," Chavez said during a televised appearance. "Only that they profit in a rational manner, that they not steal from the people."

The Chavez government has undertaken a far-reaching expansion of price caps by examining the books of an estimated 16,000 firms that do business in Venezuela to determine "reasonable" profit for their products. Chavez has said he will seize companies that don't comply with government-set adjustments.

Officials launched the effort last year after passing the Law of Fair Prices and Costs but have held back the release of specific prices on a first wave of 19 items, mostly personal-hygiene and household-cleaning products, for several months now. The delay has unsettled local retailers as they wait to assess the impact of the measure on their operations.

On Thursday, Chavez said the announcement would be made in the next few days before revealing two of the coming changes.

Companies that face audits include local units of multinationals like Colgate-Palmolive Co. (CL), PepsiCo Inc. (PEP), H.J. Heinz Co. (HNZ), Johnson & Johnson (JNJ), Unilever PLC (UN, UL) and Nestle (NSRGY, NESN.VX), as well as local food distributor and packager Alimentos Polar.

Chavez, who is seeking re-election this October, has said rampant speculation in the private sector is responsible for the country's notoriously high inflation, which stood at an annualized rate of 26% in January.

Business leaders, however, say that the government's statist policies are the cause of economic imbalances that have produced the steep climb of consumer prices and wide-spread shortages of basic goods.

-By Ezequiel Minaya, Dow Jones Newswires; 58-414-120-5738; ezequiel.minaya@dowjones.com

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