Argentine peso

Argentine peso
Peso argentino (Spanish)
One peso coin Banknotes
ISO 4217 code	ARS
User(s)	Argentina
Inflation	est. 22% (2010)
Source	CIA Factbook[1]
Subunit
1/100	centavo
Symbol	$
Coins	5, 10, 25, 50 centavos, 1 peso
Banknotes	2, 5, 10, 20, 50, 100 pesos
Central bank	Central Bank of Argentina
Website	www.bcra.gov.ar

The peso (originally established as the peso convertible) is the currency of Argentina, identified by the symbol $ preceding the amount in the same way as many countries using dollar currencies. It is subdivided into 100 centavos. Its ISO 4217 code is ARS. Several earlier currencies of Argentina were also called "peso"; as inflation progressed a new currency with a few zeroes dropped and a different qualifier (peso national currency, peso law 18188, peso argentino...) was introduced. Since 1969 thirteen zeroes have been dropped (a factor of ten trillion times).

In recent times the exchange rate hovered around 3 pesos per United States dollar from 2002 to 2008, and was around 4 pesos from 2009 to 2011. The country's current account surplus has required periodic dollar purchases by the Central Bank to keep the value of the peso relatively undervalued for export competitiveness.^[2]

History

Amounts in earlier pesos were sometimes preceded by a "$" sign and sometimes, particularly in formal use, by symbols identifying that it was a specific currency, for example $m/n100 or m$n100 for pesos moneda nacional. The peso introduced in 1992 is just called peso (sometimes peso convertible), and is written preceded by a "$" sign only. Earlier pesos replaced currencies also called peso, and sometimes two varieties of peso coexisted, making it necessary to have a distinguishing term to use, at least in the transitional period; the 1992 peso replaced a currency with a different name, austral.

Peso before 1826

The peso was a name often used for the silver Spanish eight-real coin. Following independence, Argentina began issuing its own coins, denominated in reales, soles and escudos, including silver eight-real (or sol) coins still known as pesos. These coins, together with those from neighbouring countries, circulated until 1881.

Peso fuerte, 1826–1881

In 1826, two paper money issues began, denominated in pesos. One, the peso fuerte ($F) (ISO 4217: ARF) was a convertible currency, with 17 pesos fuertes equal to one Spanish ounce (27.0643 g) of 0.916 fine gold. This was changed in 1864 when the rate dropped to 16 pesos fuertes per gold ounce.^{[citation needed]} It was replaced by the peso moneda nacional at par in 1881.

Peso moneda corriente, 1826–1881

Main article: Argentine peso moneda corriente

The non-convertible peso moneda corriente (everyday currency) ($m/c) was also introduced in 1826. It started at par with the peso fuerte, but depreciated with time.

Although the Argentine Confederation issued 1-, 2- and 4-centavo coins in 1854, with 100 centavos equal to 1 peso = 8 reales, Argentina did not decimalize until 1881. The peso moneda nacional (m$n or $m/n) (ISO 4217: ARM) replaced the earlier currencies at the rate of 1 peso moneda nacional = 8 reales = 1 peso fuerte = 25 peso moneda corriente. Initially, one peso moneda nacional coin was made of silver and known as patacon. However, the 1890 economic crisis ensured that no further silver coins were issued. At the beginning of the 20th century, the Argentine peso was one of the most traded currencies in the world.^{[citation needed]}

Gold and silver pesos, 1881–1969

The Argentine gold coin from 1875 was the gold peso fuerte, one and two-thirds of a gram of gold of fineness 900, equivalent to one and a half grams of fine gold, defined by law 733 of 1875. This unit was based on that recommended by the European Congress of Economists in Paris in 1867 and adopted by Japan in 1873 (the Argentine 5 peso fuerte coin was equivalent to the Japanese 5 yen).^[3]

The monetary system before 1881 has been described as "anarchistic" (anarquía monetaria).^[3] Law 1130 of 1881 put an end to this; it established the monetary unit as the peso oro sellado ("stamped gold peso", ISO 4217: ARG), a coin of 1.612 grams of gold of fineness 900 (90%), and the silver peso, 25 g of silver of fineness 900.^[3] Gold coins of 5 and 2.5 pesos were to be used, silver coins of one peso and 50, 20, 10 and 5 centavos, and copper coins of 2 and 1 centavos.

Peso moneda nacional, 1881–1969

1891 banknote

The depreciated peso moneda corriente was replaced in 1881 by the paper peso moneda nacional (national currency, (m$n or $m/n) at a rate of 25 to 1. This currency was used from 1881 until 1969^[4] The design was changed in 1899 and again in 1942.

Initially the peso m$n was convertible, with a value of one peso oro sellado. Convertibility was maintained off and on, with decreasing value in gold, until it was finally abandoned in 1929, when m$n 2.2727 was equivalent to one peso oro.

Peso ley, 1970–1983

Main article: Argentine peso ley

The peso ley 18.188 (ISO 4217: ARL) (informally called the peso ley) replaced the previous currency at a rate of 1 peso ley to 100 pesos moneda nacional.

Peso argentino, 1983–1985

Main article: Argentine peso argentino

The peso argentino ($a) (ISO 4217: ARP) replaced the previous currency at a rate of 1 peso argentino to 10,000 pesos ley (1 million pesos m$n). The currency was born soon after the return of democracy. However, it rapidly lost its purchasing power and was devalued several times, and was replaced by a new currency called the austral in June 1985.

Austral, 1985–1991

Main article: Argentine austral

The austral (the symbol was an uppercase A with an extra horizontal line) (ISO 4217: ARA) replaced the peso argentino at a rate of 1 austral to 1000 pesos (one billion pesos m$n). During the period of circulation of the austral, Argentina suffered from hyperinflation. The last months of President Raul Alfonsín's period in office in 1989 saw prices move up constantly (200% in July alone), with a consequent fall in the value of the currency. Emergency notes of 10,000, 50,000 and 500,000 australes were issued, and provincial administrations issued their own currency for the first time in decades. The value of the currency stabilized soon after President Carlos Menem was elected.

Peso convertible, from 1992

The current peso (ISO 4217: ARS) replaced the austral at a rate of 1 peso = 10,000 australes (ten trillion pesos m$n). It was also referred to as peso convertible since the international exchange rate was fixed by the Central Bank at 1 peso to 1 U.S. dollar and for every peso convertible circulating, there was a U.S. dollar in the Central Bank's foreign currency reserves. After the various changes of currency and dropping of zeroes, one peso convertible was equivalent to 10,000,000,000,000 (10¹³) pesos moneda nacional. However, after the financial crisis of 2001, the fixed exchange rate system was abandoned.

Since January 2002, the exchange rate fluctuated, up to a peak of four pesos to one dollar (that is, a 75% devaluation). The export boom then produced a massive inflow of dollars into the Argentine economy, which helped lower their price. For a time the administration stated and maintained a strategy of keeping the exchange rate at between 2.90 to 3.10 pesos per U.S. dollar, in order to maintain the competitiveness of exports and encourage import substitution by local industries. When necessary, the Central Bank emits pesos and buys dollars in the free market (sometimes large amounts, in the order of 10 to 100 million USD per day) to keep the dollar price from dropping, and had amassed over 27,000 million USD in reserves before the 9,810 million USD payment to the IMF in January 2006.

The effect of this may be compared to the neighboring Brazilian real, which was roughly on a par with the Argentine peso until the beginning of 2003, when both currencies were about three per U.S. dollar. The real started gaining in value more than the peso due to Brazil's slower buildup of dollar reserves; by December 29, 2009 a real was worth almost 2.2 pesos.^[5]

Coins

In 1992, 1-, 5-, 10-, 25- and 50-centavo coins were introduced, followed by 1 peso in 1994. The 1-centavo coins were last minted in 2001 and they have been withdrawn from circulation.

Circulating coins

Denomination	Obverse      Reverse
1 centavo
5 centavos
10 centavos
25 centavos
50 centavos
1 peso

Commemorative coins

Commemorating the National Constitutional Convention, 2-peso and 5-peso nickel coins were issued in 1994.

Commemorative coins

Denomination	Obverse Reverse
2 pesos (1994)
5 pesos (1994)
2 pesos (2007)

Some 2-peso coins were emitted in 1999 to commemorate the centennial of the birth of world-famous writer and poet Jorge Luis Borges; they had an image of Borges' face on one side, and a labyrinth and the Hebrew letter aleph on the other. In addition, commemorating the 50th anniversary of the death of Eva Perón, on September 18, 2002 a new 2-peso coin with her face was created. It was said that this coin would replace the old AR$2 banknote if inflation continued to be high. None of the 2-peso coins are currently in wide circulation.

Some other 50- and 1-peso coins exist commemorating different events, including the 50th anniversary of the creation of UNICEF (1996); the attainment of voting rights by women (1997); the establishment of Mercosur (1998); and the death of José de San Martín (2001).

In 2010, commemorating the bicentennial anniversary of the May Revolution, several 1-peso coins were issued, all featuring the same obverse, different from the main series, and images of different places on the reverse, such as Mar del Plata, the Perito Moreno Glacier, mount Aconcagua, the Pucará de Tilcara, and El Palmar.

The problem of change

Small denomination currency and particularly coins are often hard or impossible to come by in Argentina, especially in Buenos Aires. The problem has developed to the stage where some shop owners will not sell items if the transaction involves giving the purchaser change in coins. The problem has been exacerbated by ATMs, which frequently give out only 100 peso notes, and by the bus companies, some of which will take only coins in payment and frequently sell these at a 5–10% markup on the black market rather than depositing them at banks.^[6] The situation improved in the years following the Argentine economic crisis (1999–2002). Some 140 bus lines have a Sube (Sistema Único de Boleto Electrónico) smartcard reader, allowing passengers to pay electronically without coins.^[7]

Banknotes

In 1992, banknotes were introduced in denominations of 1, 2, 5, 10, 20, 50, and 100 pesos. The 1-peso note was replaced by a coin in 1994. The pictures below are outdated, since they bear the "Convertibles de curso legal" (meaning that value was fixed to the same amount in US dollars). New bills, printed since 2002, do not have this text. As most bills have been replaced, it is rare to find ones marked as convertible except in the large $50 and $100 denominations.

Image		Denomination	Dimensions	Color	Front	Back
		$1 (not currently in use, replaced by the 1-peso coin)	155 × 65 mm	Navy blue	Carlos Pellegrini	Argentine National Congress
		$2		Light Blue	Bartolomé Mitre	Mitre Museum
		$5		Green	José de San Martín	Cerro de la Gloria
		$10		Brown	Manuel Belgrano	National Flag Memorial
		$20		Red	Juan Manuel de Rosas	Battle of Vuelta de Obligado
		$50		Black	Domingo Faustino Sarmiento	Casa Rosada
		$100		Violet	Julio Argentino Roca	Conquest of the Desert
These images are to scale at 0.7 pixels per millimeter, a standard for world banknotes.

Current ARS exchange rates
From Google Finance:	AUD CAD CHF EUR GBP HKD JPY USD BRL
From Yahoo! Finance:	AUD CAD CHF EUR GBP HKD JPY USD BRL
From OzForex:	AUD CAD CHF EUR GBP HKD JPY USD BRL
From XE.com:	AUD CAD CHF EUR GBP HKD JPY USD BRL
From OANDA.com:	AUD CAD CHF EUR GBP HKD JPY USD BRL

See also

• Casa de Moneda de la República Argentina - Argentine mint
• Economy of Argentina
• Historical exchange rates of Argentine currency
• Peso corriente, Spanish Wikipedia (Spanish)
• Peso moneda nacional, Spanish Wikipedia (Spanish)

References

1. ^ CIA Factbook: 2010 world inflation estimates
2. ^ Clarín: Boudou asegura que no habrá ajustes en el valor del dólar. (Spanish)
3. ^ ^{a b c} (Spanish) Historia de la moneda
4. ^ Billetesargentinos.com.ar (Spanish), Billegesgarentinos.com.ar (English) Billetes argentinos site. Spanish version is more detailed.
5. ^ Brazilian-Argentine Exchange Rate
6. ^ Bao, Sandra et al. (2010). South America on a shoestring. Victoria, OR: Regis St. Louis. ISBN 978-1-74104-923-7. 
7. ^ Sistema Único de Boleto Electrónico

• Krause, Chester L. and Clifford Mishler (1991). Standard Catalog of World Coins: 1801–1991 (18th ed. ed.). Krause Publications. ISBN 0873411501. 
• Pick, Albert (1994). Standard Catalog of World Paper Money: General Issues. Colin R. Bruce II and Neil Shafer (editors) (7th ed.). Krause Publications. ISBN 0-87341-207-9. 

Further reading

• Cunietti-Ferrando, Arnaldo J.: Monedas de la Republica Argentina desde 1813 a nuestros Dias. Cooke & Compañia. Editores Numismaticos, Buenos Aires, 1978.
• Cunietti-Ferrando, Arnaldo J.: Monedas y Medallas. Cuatro siglos de historia y Arte. Coins and Medals. Four centuries of history and art. Manrique Zago ediciones, Buenos Aires, 1989.
• Janson, Hector Carlos: La Moneda Circulante En El Territorio Argentino 1767-1998. Buenos Aires, 1998.

External links

• (Spanish) Argentine Notes; site has Spanish and English versions, more detail in Spanish
• (Spanish) Base de datos de Rodolfo Frank - El valor de la moneda
• Images of historic and modern Argentine coins