Icelandic Króna

The currency of Iceland is the Icelandic króna (plural: krónur). The króna is subdivided into 100 eyrir (singular and plural), and its ISO 4217 code is ISK. The word "krona" means "crown" in Icelandic, and the name "eyrir" derives from Old Norse "aurar", meaning "coins". The króna has been Icelandic currency since 1874, when Icelanders decided to break away from the Danish monetary system and adopt their own currency. Prior to that, Iceland had used the Danish krone. The first Icelandic coins were minted in 1875, and featured the Icelandic coat of arms on one side and the Danish coat of arms on the other. In 1915, Iceland switched to the gold standard, pegging the króna to the British pound sterling. This lasted until 1931, when Iceland abandoned the gold standard and allowed the króna to float freely. The króna remained relatively stable against the pound sterling until the early 1970s, when the Bretton Woods system collapsed and the króna began to appreciate rapidly. This caused inflation in Iceland, and in 1981, the Central Bank of Iceland introduced currency controls in an attempt to stabilize the króna. These controls were gradually relaxed, and finally abolished in 2001. The króna has been relatively stable since then, although it did experience a sharp decline in value during the global financial crisis of 2008. It has since recovered and is once again trading close to its pre-crisis levels. The Central Bank of Iceland is responsible for issuing the Icelandic currency. Icelandic banknotes come in denominations of 500, 1,000, 5,000 and 10,000 krónur. Coins come in denominations of 1, 2, 5, 10, 20 and 50 krónur. There are also 100 and 500 krónur coins, but these are rarely used in everyday transactions. The króna is currently pegged to a basket of currencies, with the euro accounting for the largest share. This peg was introduced in 2008 in an effort to stabilize the Icelandic currency.