The official currency in Mexico is called the Peso. This currency comes in both coin and paper form, with coins in denominations for one, two, and five, which are round, and made of silver with a gold center, as well as 10 and 20 peso coins, which are also round but in this case, the design features gold on the outside. For the Mexican peso coin, as the denomination decreases, so does the size of the coin.
Then for the Mexican Peso in paper form, bills come in denominations for 10, 20, 50, 100, 200, and 500. To distinguish the different denominations, each is printed on a different colored paper. Now, to understand the exchange rate of the Mexican Peso, one Peso is equivalent to 100 centavos. Although centavos are rarely seen or used, some people do use them or simply keep them as souvenirs.
Interestingly, most people will use the $ sign when writing about the Mexican Peso. However, sometimes the letters MN are listed before the dollar sign, which stands for Moneda Nacional, or in English, “National Currency.” For the Mexican Peso, the exchange rate actually changes on a daily basis. Because of this, it is important to use a handheld converter or find one available online. However, the most current numbers show that the Mexican Peso is exchanging at 8 or 9 to every $1 US Dollar.
This currency has had an interesting history, one that involved the government trying to devalue the Peso as a way of lowering living standards, promoting capital flight, and putting investor confidence at risk. However, with political aspects being considered, this was halted in 1994, a time of presidential and congressional elections.
Unfortunately, with capital inflow slowing down, the new Mexican Peso began to see a downward spiral and by the end of that same year, the Mexican government was depending on international reserves to support and boost the new Peso. Then when the reserves for this country almost disappeared completely, the government had to do something to boost the value of the Peso. This resulted with the new Peso being introduced in December of 1994. At that time, the exchange rate changed from 3.4 to 4.1 for the new Peso to $1 US Dollar.
Pressure on the new, Mexican Peso continued, forcing the government’s administration to stop the currency float, which pushed the new Peso in 1994 to 5.3. Throughout the first part of 1995, the Peso continued to lose value, which put tremendous doubt on investors who believed the $29 billion US for short-term tesebono debt would never be repaid. This only worsened when the Mexican Peso dropped even further to 6.5 at the end of 1995 and 7.4 in the first month of 1996.
Today, the Mexican Peso is still called the “New Peso” or “Nuevo Peso”. The reason for this is the revalue of this currency in 1994/1995. However, for people that still possess any of the Old Pesos the value is not as much. For instance, New Pesos have a value of 100 Centavos or cents to $1 US Dollar but Old Pesos are only valued around .50 to every US Dollar. Although people can still spend the old Mexican Peso, they will not get as much value as if spending the New Pesos.
As mentioned, the one thing about the Mexico Peso that makes this currency somewhat challenging is that it is constantly changing. While changes are not typically significant, this is common. The most recent information pertaining to the Mexico Peso is that the exchange rate is around 12 to $1 US Dollar.
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