What Is the Mexican Peso?


Quick Answer

The Mexican peso is the national currency of Mexico and has been in use since the 1800s, according to Currency Information. Just as subunits of the U.S. dollar are known as "cents," subunits of the Mexican peso carry the name of "centavos."

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What Is the Mexican Peso?
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Full Answer

The Mexican Peso is one of the oldest North American currencies in circulation, states Currency Information. Its original design was modelled after the Spanish silver dollar and the original eight pieces. The peso carried the status of official tender throughout North America until the mid-1850s. It has enjoyed a long history as a financially stable currency, so much so that it was, at one time, the most acceptable mode of tender in far-away areas, such as China. It also served as the inspiration for the U.S. dollar's design.

Throughout the 20th century, Mexican pesos continued to be safe currency options until the oil crisis occurred in the 1970s. This caused an increase in foreign loans to the country. The situation worsened until the Mexican government finally defaulted on the payment of its loans. This resulted in a downward spiral until the 1990s, when the government made adjustments in Mexico's monetary policies and changed the value of 1,000 pesos into 1 peso, calling this new unit the "nuevo peso."

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