functional currencies. Due to our global operations, weakness in some of these currencies might be offset by strength in others. In2012, 2011 and 2010, the weighted-average exchange rates for foreign currencies in which the Company conducted operations (all operating currencies), and for certain individual currencies, strengthened (weakened) against the U.S. dollar as follows 

These percentages do not include the effects of our hedging activities and, therefore, do not reflect the actual impact of fluctuations in foreign currency exchange rates on our operating results. Our foreign currency management program is designed to mitigate, over time, a portion of the impact of exchange rate changes on our net income and earnings per share. The total currency impact on operating income, including the effect of our hedging activities, was a decrease of approximately 5 percent and an increase of approximately 4 percent in 2012 and 2011, respectively. Based on spot rates as of the beginning of February 2013, our hedging coverage in place, and the impact of Venezuela's currency devaluation discussed below, the Company expects currencies to have a 4 percent negative impact on operating income for the first quarter of 2013 and a 1 percent negative impact on operating income for the full year of 2013. 

Foreign currency exchange gains and losses are primarily the result of the remeasurement of monetary assets and liabilities from certain currencies into functional currencies. The effects of the remeasurement of these assets and liabilities are partially offset by the impact of our economic hedging program for certain exposures on our consolidated balance sheets. Refer to Note 5 of Notes to Consolidated Financial Statements. Foreign currency exchange gains and losses are included as a component of other income

(loss) — net in our consolidated financial statements. Refer to the heading "Operations Review — Other Income (Loss) — Net" above. The Company recorded foreign currency exchange losses of $2 million, $73 million and $148 million in 2012, 2011 and 2010, respectively. 

Hyperinflationary Economies 

Our Company conducts business in more than 200 countries, some of which have been deemed to be hyperinflationary economies due to excessively high inflation rates in recent years. These economies create financial exposure to the Company. 

In 2010, Venezuela was determined to be a hyperinflationary economy, and the Venezuelan government devalued the bolivar by resetting the official rate of exchange (“official rate”) from 2.15 bolivars per U.S. dollar to 2.6 bolivars per U.S. dollar for essential goods and 4.3 bolivars per U.S. dollar for nonessential goods. In order to utilize the official rate, entities must seek approval from the government-operated Foreign Exchange Administration Board (“CADIVI”). In accordance with hyperinflationary accounting under accounting principles generally accepted in the United States, our local subsidiary was required to use the U.S. dollar as its functional currency. As a result, during the first quarter of 2010 we remeasured the net assets of our Venezuelan subsidiary using the official rate for nonessential goods of 4.3