Peso (Chilean currency)

The Chilean peso (symbol: $; ISO 4217: CLP) has been the legal tender of Chile since 1975.

It was established in 1817, together with the independence of the country, and in 1851 the decimal system was established in the peso, which was made up of 100 cents. It remained the legal tender in Chile until December 31, 1959, when it was replaced by the escudo.

Through Decree Law 1123 of 1975, the peso was resumed as a monetary unit as of September 29 of that year, with a conversion rate of one peso for every thousand escudos. The subdivision in cents was maintained until January 1, 1984, when these were eliminated, so the accounting began to be kept in whole pesos.

Historically, it has been manufactured by the Chilean Mint (1743) and regulated by the Central Bank of Chile (1925), in charge of controlling the amount of money in circulation.

History

First weight (1817-1960)

First coin of independent Chile (1817)

Currency of 1 Weight (1933)

Although the adoption of the peso to replace the colonial real dates back to 1817, with the beginning of the Patria Nueva period, the Spanish currency system continued to be used in which 8 reales were equivalent to 1 peso and 2 pesos to 1 shield. This custom persisted in Chile until 1851, when the decimal system was adopted, in which 1 peso was made up of 10 tenths or 100 cents.

In 1925, the circulation of money was controlled by the newly created Central Bank of Chile. »; It was also established that in all coins of 10 pesos or more, their value in pesos would be stamped in letters and figures, and in smaller letters their equivalence in condors.

Starting in 1932, the value of the peso began to gradually decline, and by the 1940s, inflation began to rise rapidly. In 1955, as a consequence of this, it was established that all obligations be paid in whole pesos, without cents.^{[citation required]}

In the context of a policy to clean up the national economy and control inflation undertaken by the government of Jorge Alessandri, between 1960 and 1975 the peso was replaced by the escudo (Eº). The conversion rate was 1000 pesos for 1 shield.

Second peso (1975-present)

Weight to dollar exchange rate (1975-2010)

The hyperinflation that existed during the government of Salvador Allende, which reached figures of around 600 and 800%, was one of the main causes of the economic crisis that his administration faced. After the 1973 coup, one of the economic reforms established by the military dictatorship was the conversion to the peso. Thus, on September 29, 1975, an exchange rate of 1,000 escudos for 1 peso was established by Decree Law 1123.

The first coins issued under the new system were 1, 5, 10, 50 centavos, and 1 peso; later the values of 5 and 10 pesos were added. The 1, 5, 10, and 50 cent coins had limited issue due to increasing devaluations that occurred during the 1980s.

Between 1979 and 1982, the exchange rate remained fixed at 39 pesos per US dollar; however, inflationary pressure meant that the economy could not withstand said fixation and, within the framework of the 1982 crisis, the The national currency slowly began to devalue: the exchange rate dropped to $78 per dollar in June 1982, while two months later the peso became a floating currency. Already in 1984, the price was 100 pesos per dollar.

Towards the 1990s, inflation made both cent coins and 5, 10, 50 and 100 pesos bills disappear, replaced by coins. Towards the end of that decade, the 2000 and 20,000 bills also appeared, along with a 500-peso coin, which eliminated the bill of the same denomination. Later changes in the banknotes allowed the introduction of symbols for their recognition by people with visual problems and polymer banknotes were incorporated, instead of paper, for the 1000, 2000 and 5000 banknotes.

On July 15, 2022, the exchange rate reached all-time highs, reaching around 1,050 pesos for the sale price; After that, the Central Bank of Chile carried out an intervention in the exchange market.

Coins

Inverse and reverse of the second currency of 1 peso, issued between 1975 and 1977. Composed of a copper alloy, zinc and nickel, its diameter was 24 millimeters

All coins minted since 1975, when the peso was adopted as legal tender, are valid in the country. Their denominations and designs have changed over time: initially, only coins of 1, 5, 10 and 50 cents and 1 peso were issued; later, the cents were discontinued and the coins of 5, 10, 50, 100 and 500 pesos were added to replace the bills of the same denominations. The 500-peso coin was the first bimetallic coin produced in the country.

In 2009, a project was presented to create 20 and 200 pesos coins, but it was rejected. On April 26, 2016, the Central Bank proposed to the Ministry of Finance to send a project to Congress to eliminate the coins of 1 and 5 pesos due to little use and their high manufacturing cost. The following May 2, a project for a new family of coins was presented to President Michelle Bachelet, which would enter into circulation in the second half of 2017. In August of that year, Congress approved a bill that included the elimination of the 1 and 5-peso coins. As of November 1, 2017, the 1 and 5-peso coins were no longer issued by Banco Central and rounding up for cash payments came into effect.

On October 10, 2018, the Central Bank announced the start of the withdrawal from circulation of the old 100-peso coins, manufactured between 1981 and 2000; however, they are still valid as a means of payment and the measure mainly involves the withdrawal of the currency by financial institutions to reduce its coexistence with current currencies.

Ancient Coins

Coins in production

Special Coins

Apart from the denominations in regular use, the Chilean Mint has minted commemorative coins, which have current value according to the law, on the following occasions:

• In 1976: up to 3000 coins of 100 pesos of gold commemorating the “third anniversary of Chile’s liberation”.
• In 1978: up to 1000 units of each series of coins of 50 and 500 pesos of gold and 10 pesos of silver, also in commemoration of the "third [sic] anniversary of the liberation of Chile».
• In 1991: up to 75 000 units, but 34 800 were manufactured, of 10 000 silver pesos coins in commemoration of the fifth centenary of the discovery of America.
• In 1993: up to 50 000 units, but 46 000 of 2000 silver pesos were manufactured in commemoration of the 250 years of the founding of the Chilean Mint House.

In February 2010, it was discovered that part of the production of 50-peso coins, manufactured by the Mint in 2008, had the legend «REPÚBLICA DE CHIIE [sic] ” instead of “REPÚBLICA DE CHILE” on the obverse. This, added to previous management problems, cost Gregorio Íñiguez Díaz, general manager of said company, his job. entity.

Circulation

Tickets

Series between 1975 and 2009

When the peso was reestablished as the official currency in 1975, bills of 5 and 10 pesos were introduced —product of inflation, the following year they were replaced by coins of the same denominations— in addition to bills of 50 and 100 pesos; in the following years, the latter were also replaced by coins, and the 500, 1000 and 5000 pesos bills appeared. In the late 1980s, only 500, 1,000, 5,000 and 10,000 peso bills were printed – the latter was introduced in 1989.

In 1997, the 2,000-peso bill entered circulation, the following year the 20,000-peso bill, and two years later the 500-peso bill ceased to circulate, replaced by a coin. During 2009, the banknotes in production were those of 1,000, 2,000, 5,000, 10,000 and 20,000 pesos; in that year the introduction of a new series of banknotes began. At present, many of these banknotes are still in circulation, although it is less and less frequent to find them. Banknotes with denominations less than 1,000 pesos are not in circulation, but are still legally valid throughout the country and maintain their original face value.

Bicentennial Series (since 2009)

The then president of Banco Central José De Gregorio presents the new 5000 pesos ticket, in September 2009

The Central Bank of Chile began the production of a new series of banknotes in the second semester of 2009 to commemorate the bicentennial of the country. Although their denominations and the characters portrayed were not modified, the sizes were changed, which varied based on denomination, and security features were added to prevent counterfeiting. Three of the notes in the new series are made of polymer and two are made of cotton paper.

The design was unified, presenting the face of each character on the obverse together with the antú —Mapuche representation of the Sun— and a cross section of the heart of a copihue, the national flower. Meanwhile, on the reverse of each bill, landscapes from various national parks were incorporated together with a native animal species:

• On September 24, 2009 the circulation of the 5000 pesos ticket began, the first of the series to be launched.
• On 6 January 2010, the 10 000 pesos was presented, which was to be introduced on 3 March; the result of the earthquake of 27 February 2010 was postponed by 31 March.
• On June 8, 2010, the third, the 20 000 pesos, introduced on July 28 of the same year, was the only one in which the original colour — from ochre to orange — was changed to make it more distinctive.
• On October 6, 2010, the new 2000 peso ticket was unveiled, which retains the design line of the previous tickets, although with a more intense violet colour.
• On March 16, 2011, the 1000-weight bill was presented, which changed the light green of the previous design by an intense yellowish green.

In popular culture

Old colloquial expressions that have survived in Chilean Spanish to this day are:

• "I don't have a twenty," referring to the coin of twenty cents that he calculated between 1907 and 1941.
• «I don't have a copper», referring to the coins of a penny that circulated in the middle of the centuryXIX and beginnings of the centuryXX. as well as those of weight that circulated between 1942 and 1959, both made of copper.

In addition, in colloquial Chilean Spanish certain nicknames are used for some coins and bills —two of the latter are occasionally referred to by the name of the character portrayed; However, none of these nicknames is used by a large part of the population:

• sota: The currency of ten pesos, although it is no longer heard with that meaning. Today it refers to the ten thousand pesos bill.
• half a shit.: The coin of fifty pesos.
• gamba: The one hundred peso coin—this denomination is due to the old one hundred pesos bill used before 1960, so called for its red color, similar to that of the shrimps.
• Machine: The five hundred pesos coin.
• luca: The thousand-weight bill—the bulk of the population uses this term without this being considered vulgar; cultural activities are also promoted "to Luca". Previously it was called the shield and the old weight.
• Gabriela.: Five thousand pesos.
• arturito: Ten thousand pesos.

In very informal contexts, the expressions un guatón and un stick are also used to refer to the sum of one million pesos.

Although it sounds strange, sometimes in popular slang, and preferably in coa, a different value is given to bills and amounts, dividing them by a thousand: the thousand-peso bill is called "one peso"; for two thousand, "two pesos"; for five thousand, "five pesos"; for ten thousand, "ten pesos"; and for twenty thousand, "twenty pesos." The sum of one hundred thousand pesos is called "one hundred pesos", etc..

Reconversion of currencies of other Latin American countries

Historically, and as in other countries, zeros have been removed from the Chilean currency due to its reconversion; In addition, it has undergone name changes.

Additional bibliography

• Martínez, Juan Manuel; and Lina Nagel Vega (2009). Iconography of Chilean coins and notes. Collection of coins and banknotes of the Central Bank of Chile (PDF). ISBN 978-956-7421-31-2.
• Martínez, Juan Manuel (s/f). "Iconography of money, from the Popular Front to Popular Unity. Chile 1938-1973» (PDF). www.museohistoriconacional.cl.