Uruguayan peso facts for kids

Quick facts for kids Uruguayan peso
current 100 peso note
ISO 4217 Code	UYU
User(s)	Uruguay
Inflation	4.96%
Source	Instituto Nacional de Estadística, July 2024.
Subunit
1⁄100	centésimo
Symbol	$ or $U
Coins
Freq. used	$1, $2, $5, $10
Rarely used	$50 (commemorative)
Banknotes	$20, $50, $100, $200, $500, $1000, $2000

The Uruguayan peso (Spanish: peso uruguayo) is the money used in Uruguay. It has been called "peso" since Europeans first settled there. The money used today, the peso uruguayo, started in 1993. It can be divided into 100 centésimos, but these smaller coins are not used much anymore.

How Uruguay's Money Changed Over Time

Uruguay's money was very stable in 1896. This was because it followed the gold standard. This meant that the value of the money was directly linked to a certain amount of gold.

However, this stability ended after World War I. The country faced money problems. After World War II, these problems got worse. Prices started to rise very quickly, which is called inflation. This became a big issue after 1964 and continued into the 1970s.

Because of this inflation, the old money, called the "peso moneda nacional," was replaced. On July 1, 1975, a new currency was introduced. It was called the nuevo peso (new peso). One new peso was worth 1000 old pesos. The nuevo peso also had 100 centésimos.

But inflation continued to be a problem. So, on March 1, 1993, the peso uruguayo was introduced. This is the money used today. Again, one new peso uruguayo was worth 1000 of the old nuevo pesos.

Understanding Inflation and Money Value

People in Uruguay got used to their money losing value over time. This is called devaluation. When the local money gets stronger compared to other currencies, they call it atraso cambiario. This means the exchange rate is "running late" and they expect it to go down again.

Because the local money was not always stable, many expensive things are priced in U.S. dollars. This includes houses, cars, and even some high salaries.

Money Changes and Their Impact

During a time when the military ruled Uruguay, the peso's value was slowly changed against the U.S. dollar. The government even published a daily table showing the future value of the dollar. This table was called the tablita.

In 1982, the money was suddenly devalued. This means its value dropped very quickly. This event was called "the tablita was broken." It caused many businesses and people to go bankrupt. They could not pay their debts.

In the 1990s, a new system was tried to make the exchange rate more predictable. The government would try to keep the peso's value within a certain range.

But in 2002, Uruguay faced a big banking crisis. The government also had a huge budget problem. So, the money was allowed to "float" freely. This meant its value was decided by the market. The peso lost almost half its value in just a few weeks. Again, many businesses and people who owed money in U.S. dollars went bankrupt.

Recent Changes in Money Value

Something new happened in 2004. The Uruguayan peso actually gained value against the U.S. dollar. It went from 30 pesos for one dollar to 24 pesos. By 2008, it even reached 19 pesos to the dollar. This was good for people who had debts in dollars.

However, this made it harder for businesses that sold goods to other countries. Their products became more expensive for foreign buyers. They felt they were losing their ability to compete. By July 2020, the peso had gone back to over 40 to the dollar.

The government hopes that letting the currency float will make people use U.S. dollars less in their daily lives. Uruguay is still trying to find a way to make its money's value predictable. At the same time, it wants to make sure its exports stay competitive in the world market.

Coins

New coins were introduced in 1994. These included 10, 20, and 50 centésimos made of stainless steel. There were also 1 and 2 pesos uruguayos made of brass. Later, 5 and 10 pesos uruguayos coins were added in 2003 and 2004. These coins replaced paper money of the same value.

Here are some of the coins that are used:

In July 2010, the 50 centésimos coins were taken out of use. New 1, 2, 5, and 10 pesos coins were released in January 2011.

Banknotes

Between 1995 and 1996, new paper money (banknotes) was introduced. These included values of 5, 10, 20, 50, 100, 200, 500, and 1000 pesos uruguayos. These were updated versions of older notes. In 1999, new designs for the 5 and 10 pesos notes came out.

In 2003, the 5 and 10 pesos notes were replaced by coins. A new 2000 pesos note was also introduced. A new series of banknotes came out in 2014–2015. These were similar to the previous ones but without the vertical word "URUGUAY" on the left side.

Here are the banknotes that are currently used:

Digital Money in Uruguay

While many places still use a lot of cash, some countries are looking into digital money. Uruguay is one of them. They have been exploring a "Central Bank Digital Currency" (CBDC). This would be like a digital version of their cash, but it would be issued by the central bank. It would be an extra way to pay, alongside physical cash. Sweden and Uruguay are two countries that have shared a lot of information about their plans for digital money.

Other Money Units

Uruguay also uses special units for accounting:

• The Unidad Previsional (UP) is a unit used for pension calculations.
• The Unidad Indexada (UI) is a unit that changes its value based on consumer prices. This helps protect money from inflation.

See also

• Economy of Uruguay
• Argentine peso
• Chilean peso
• Classical Monetary System of the Oriental Republic of Uruguay