Chilean peso · Lablypedia

The current peso was introduced on 29 September 1975 by decree 1,123, replacing the escudo at a rate of 1 peso for 1,000 escudos. The currency is issued by the Central Bank of Chile, founded in 1925 and made responsible for monetary policy and control of the money supply, and produced by the Casa de Moneda de Chile (the Chilean mint), which traces its origin to a royal charter (Real Cédula) issued by King Philip V of Spain on 1 October 1743 authorizing a mint in Santiago.

History

Chile experienced severe hyperinflation during the government of Salvador Allende (1970–1973), with annual price increases estimated at between 600 and 800 percent, a major factor behind the economic crisis that helped precipitate the 1973 coup d'état. Following the coup, the military government undertook a series of economic reforms, among them the reintroduction of the peso, replacing the escudo at a rate of 1,000 escudos to 1 peso by decree law 1,123 of 29 September 1975; the new unit revived the name of the currency that had circulated in Chile from 1817 to 1960.

Between 1974 and 1979, the Chilean peso was allowed to float within a crawling band. From June 1979 the peso was pegged to the United States dollar at a fixed rate of 39 pesos per dollar. The peg could not be sustained under continued inflationary pressure, and in June 1982, amid that year's economic crisis, the peso was devalued, weakening to around 78 pesos per dollar within two months before the currency was allowed to float; by 1984 the exchange rate had reached approximately 100 pesos per dollar. In August 1984 the peso returned to a system of crawling bands, periodically adjusted to reflect differences between external and internal inflation.

Through the late 1980s and much of the 1990s, the band system, combined with capital controls and disciplined fiscal policy, delivered a period of relative macroeconomic stability, and the band's width and central parity were adjusted several times as Chile's economy became progressively more open to international trade and capital flows. That stability was tested in 1997–98, when the Asian financial crisis triggered a sharp fall in the price of copper, Chile's principal export, pushing the current account deficit to around 6 percent of GDP; to defend the band, the Central Bank raised its reference interest rate from 8.5 to 14 percent in September 1998, contributing to a slowdown in growth from an average of 7.7 percent over the previous seven years to 4.4 percent that year, followed by a 0.5 percent contraction in 1999. Compounded by a severe drought and by the additional shock of Russia's 1998 default, the strain of defending the band proved unsustainable, and in September 1999 the Central Bank abandoned it altogether, allowing the peso to float freely against the United States dollar for the first time.

Chile's Central Bank, however, reserved the right to intervene, which it did on two occasions in the early years of the float to counter excessive depreciation: the first, in August and September 2001, coincided with Argentina's convertibility crisis and with the September 11 attacks in the United States. The second, in October 2002, was during Brazil's presidential election. The Central Bank intervened again in the first half of 2008, buying reserves as the peso strengthened to around 432 per dollar, but suspended the program that September as the global financial crisis intensified. The crisis then drove a rapid reversal: the dollar climbed from around 560 pesos in late September 2008 to nearly 600 pesos by early October, its highest level since November 2004, before the peso recovered through 2009 as global markets stabilized, with the dollar falling back to around 507 pesos by November of that year.

The peso came under renewed pressure in 2014, when a decline in the price of copper combined with domestic factors to make it one of the worst-performing currencies in the world that year, depreciating around 10 percent against the dollar and recording its second-weakest annual performance in a decade, behind only 2008. A sharper shock followed the social unrest that began on 18 October 2019 (known as the estallido social): amid weeks of violent protests, the peso depreciated roughly 15 percent over the year and repeatedly set new record lows, falling to around 828 pesos per dollar by late November. On 28 November 2019 the Central Bank announced an unprecedented market intervention of up to US$20 billion, roughly half its international reserves, to be carried out between December 2019 and May 2020, the largest such intervention since the band was abandoned in 1999. The unrest and the accompanying destruction of infrastructure and retail businesses left a lasting mark on the exchange rate, which never returned to its pre-October 2019 levels.

The COVID-19 pandemic briefly pushed the peso to a new all-time low of around 868.6 pesos per dollar in March 2020, as collapsing copper prices and a global flight to safe-haven assets hit emerging-market currencies broadly. The peso subsequently recovered faster than most regional peers, helped by Chile's comparatively strong pre-pandemic fundamentals and an early, rapid vaccination campaign, and ended 2020 as the only major Latin American currency to gain against the dollar for the year, appreciating a modest 0.14 percent.

The dollar strengthened sharply again during the first months of the presidency of Gabriel Boric (from March 2022), driven by a fall in copper prices, political uncertainty ahead of the 2022 Chilean constitutional referendum, and inflation that reached a twenty-year high of 14.1 percent. In July 2022 the dollar exceeded 1,000 pesos for the first time in the currency's history, peaking above 1,050 pesos, prompting the Central Bank's largest exchange-rate intervention on record: up to US$25 billion between 18 July and 30 September 2022.

During 2023, the dollar underwent a strong devaluation, trading at approximately 780 pesos. On 28 July 2023, the Central Bank of Chile announced its steepest cut to the monetary policy rate since 2009, a reduction of 100 basis points from 11.25% to 10.25%, which led the dollar to rise again as access to credit widened and time deposits became less profitable, pushing the exchange rate back up to around 860 pesos per dollar. As of July 2026, annual inflation in Chile stood at 3.5 percent, still above the Central Bank's tolerance range.

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Coins

In 1975, coins were introduced in denominations of 1, 5, 10, and 50 centavos and 1 peso. The 1, 5, and 10 centavo coins were very similar to the 10, 50, and 100 escudo coins they replaced. Since 1983, inflation has left the centavo coins obsolete, and a smaller, redesigned 1-peso coin entered circulation on 1 July 1983. 5 and 10 peso coins were introduced in 1976, followed by 50 and 100 peso coins in 1981, and by a bi-metallic 500 peso coin in 2000, the first bi-metallic coin produced in Chile. Coins currently in circulation are in denominations of 1, 5, 10, 50, 100, and 500 pesos; however, as of 2016 the value of the peso has depreciated enough that most retailers and others tend to use prices that are multiples of 10 pesos, ignoring smaller amounts. The 1 peso coin is rare.

In 2009, a proposal to introduce new 20 and 200 peso coins was submitted to Congress but was ultimately rejected. On 26 April 2016 the Central Bank proposed to the Ministry of Finance that a bill be sent to Congress eliminating the 1 and 5 peso coins on account of their limited use and high production cost relative to face value, a proposal formally presented to President Michelle Bachelet on 2 May 2016. Congress passed the corresponding legislation in August 2016. On 26 October 2017 the Mint stopped producing 1 and 5 peso coins, and started accepting those coins directly at the mint to exchange for larger denomination. On 1 November 2017 commercial entities began rounding off amounts for payment in cash, rounding down for amounts ending in 1 through 5 pesos, rounding up for amounts ending in 6 through 9 pesos. Electronic transactions and cheques are not affected. This change has affected various charities which had programs to accept donations at the cash register. On 10 October 2018 the Central Bank asked financial institutions to begin withdrawing the older, monometallic 100 peso coin minted between 1981 and 2000, though it remains legal tender; the measure was intended chiefly to reduce the number of different 100 peso designs circulating side by side rather than to demonetize the coin.

Shortly after the military dictatorship in Chile (1973–1990) ended, the obverse designs of the 5 and 10 peso coins were changed. Those coins had borne the image of a winged female figure wearing a classical robe and portrayed as if she had just broken a chain binding her two hands together (a length of chain could be seen hanging from each of her wrists); beside her appear the date of the coup d'état in Roman numerals and the word LIBERTAD (Spanish for "liberty"). After the return of democracy, a design with the portrait of Bernardo O'Higgins was adopted.

In 2001, a newly redesigned 100-peso coin bearing the image of a Mapuche woman began to circulate. In February 2010, it was discovered that on the 2008 series of the 50 peso coins the country name CHILE had been misspelled as CHIIE. The national mint said that it did not plan to recall the coins. Worth about US$0.09 each at the time, the faulty coins became collector's items. The misprint, coming on top of earlier management problems at the mint, cost its general manager, Gregorio Íñiguez Díaz, his job; he was replaced by David Sturrock Newton.

Centenary and next-generation coins

On 24 June 2025, the Central Bank of Chile unveiled a special commemorative 100 peso coin marking the institution's centenary, under the slogan "A coin, a hundred years of history". The coin retains the physical characteristics and bimetallic format of the 100 peso coin already in circulation, with the obverse instead bearing the Central Bank's centenary logo, the phrase "CIEN años" ("one hundred years"), a stylized depiction of the Andes and the inscription "BANCO CENTRAL DE CHILE 1925–2025"; the reverse retains the National Emblem, the coin's face value, and a wreath of laurel. It did not replace the coin already in circulation, but entered circulation alongside it beginning 21 July 2025, with a total mintage of 30 million pieces.

In August 2026 the Central Bank announced redesigned 10 and 50 peso coins intended to lower production costs, using a steel core plated with other metals through an electroplating process common internationally but new to Chilean coinage; steel is markedly cheaper than the copper, nickel, and aluminum alloys previously used. Both coins retain the principal design elements of the coins in circulation and remain fully interchangeable with them at face value. The 50 peso coin keeps its diameter and design but becomes slightly lighter, dropping from 7 to 6.5 grams, and began entering circulation in October 2026. The 10 peso coin keeps its design but is smaller, with its diameter reduced from 21 to 18.7 millimeters and its weight reduced to 3.46 grams, and gains a plain edge to help distinguish it from other denominations; it is scheduled to enter circulation in January 2027. The Central Bank projected that, on average, the new coins would cost about 50 percent less to produce than their predecessors, with savings of roughly 70 percent for the 50 peso coin and 30 percent for the 10 peso coin.

Banknotes

In 1976, banknotes were introduced in denominations of 5, 10, 50, and 100 pesos with the reverses of the two lowest denominations resembling those of the 5,000- and 10,000-escudo notes they replaced; the 100 peso note followed on 22 July 1976. Inflation has since led to the issue of much higher denominations. Five-hundred-peso notes were introduced in May, 1977, followed by the 1000-peso (in June, 1978), 5000-peso (June, 1981), 10,000-peso (June, 1989), 2000-peso (December, 1997), and 20,000-peso (December, 1998) notes. The 5, 10, 50, 100, and 500-peso banknotes have been replaced by coins, leaving only the 1000, 2000, 5000, 10,000, and 20,000 peso notes in circulation. Redesigned versions of the four highest denominations were issued in 2009 and 2010. The popular new 1000-peso banknote was issued on 11 May 2011.

Since September 2004, the 2000-peso note has been issued only as a polymer banknote; the 5000-peso note began emission in polymer in September 2009; and the 1000-peso note was switched to polymer in May, 2011. This was the first time in Chilean history that a new family of banknotes was put into circulation for other cause than the effects of inflation. As of January 2012, only the 10,000 and 20,000 peso notes are still printed on cotton paper. All new notes have the same 70 mm (2.8 in) height, while their length varies in 7 mm (0.28 in) steps according to their face values: the shortest is the 1000-peso note and the longest is the 20,000-pesos. The new notes are substantially more difficult to falsify because of new security measures.

The design and production of the whole new family of banknotes was assigned to the Australian company Note Printing Australia Ltd for the 1000, 2000 and 5000 peso notes, and the Swedish company Crane AB for the 10,000 and 20,000 peso notes.

Design of the Bicentennial series

The new "Bicentennial" family of banknotes, introduced from 2009 onward to mark the bicentennial of Chilean independence, unified the design across denominations: each note's obverse pairs a historical figure's portrait with the antü, a Mapuche representation of the sun, and a cross-section of the heart of a copihue flower, Chile's national flower. Each note's reverse depicts a landscape drawn from one of Chile's national parks together with a native animal species: the 1000 peso note shows Torres del Paine National Park with a guanaco (the only note to depict a mammal rather than a bird); the 2000 peso note shows the Nalcas National Reserve with an austral parakeet; the 5000 peso note shows La Campana National Park with a magellanic horned owl; the 10,000 peso note shows Alberto de Agostini National Park with an Andean condor; and the 20,000 peso note shows the Salar de Surire natural monument with a Chilean flamingo. The 5000-peso note was the first of the new series to enter circulation, on 24 September 2009. Uniquely among the new series, the 20,000 peso note's color was changed on reissue, from its earlier ochre to a more distinctive orange.

Value of the peso against the United States dollar

In popular culture

Colloquial Chilean Spanish has informal names for some banknotes and coins, several of which endure from currencies that predate the current peso. Older expressions still heard today include no tengo ni un veinte ("I don't have even a twenty"), referring to the twenty-centavo coin that circulated between 1907 and 1941, and no tengo ni un cobre ("I don't have even a copper"), referring to the copper one-centavo coins that circulated from the mid-19th century into the early 20th, as well as the copper peso coins issued between 1942 and 1959.

Nicknames still applied today to current coins and notes include sota (once used for the 10-peso coin, now more often for the 10,000-peso note), medio cacho for the 50-peso coin, gamba ("prawn") for the 100-peso coin — the term dates back to a pre-1960 100-peso banknote noted for its reddish color, similar to that of a prawn, or more recently, colloquially, 100,000 pesos — quina for five hundred pesos (quinientos is Spanish for "five hundred"), luca for a thousand pesos, gabrielita for the five-thousand-peso note (after Gabriela Mistral, whose portrait it bears), and arturito for the ten-thousand-peso note (after Arturo Prat). These names are old: for example, gamba and luca applied to 100 and 1000 escudos, respectively, before 1975.

Depending on context, a gamba might mean one hundred pesos or one hundred thousand pesos. For instance a new computer might be said to cost two gambas. This means two hundred thousand pesos. Less commonly, this applies to luca, taken to mean one million, usually referred to as palo or, in very informal contexts, guatón.

In coa, the cant historically associated with the Chilean underworld and prison population, banknotes and sums are sometimes valued by dividing by one thousand: the 1000-peso note is called "one peso", the 2000-peso note "two pesos", and so on up to the 20,000-peso note, called "twenty pesos", with a sum of 100,000 pesos likewise called "one hundred pesos". A bundle of 1000-peso notes is sometimes called a lechuga ("lettuce") in the same jargon.

The cover of the 2007 Velvet Revolver album Libertad features a stylized version of the angel from the Pinochet-era 10 pesos coin. Guitarist Slash, who personally chose the image, claimed he had no idea of the significance of it at the time.