Peruvian Sol

Peru’s official currency is the nuevo sol (plural: nuevos soles; ISO 4217 code: PEN), which replaced the inti in 1991. The nuevo sol has a currency symbol of S/. and is subdivided into 100 céntimos. The nuevo sol was created to replace the hyperinflated inti. At its introduction, one new sol was worth one million old intis. The nuevo sol has been relatively stable since its introduction. It reached an all-time high against the US dollar in August 2011, but has been slowly losing value since then. Peru’s economy is heavily dependent on exports, which account for more than 60% of GDP. The country’s main export partners are the United States, China, Canada, and Japan. The nuevo sol is a freely convertible currency, and there are no restrictions on its use. The central bank of Peru is the Banco Central de Reserva del Perú (BCRP). The BCRP is responsible for the country’s monetary policy and for issuing and regulating the nuevo sol. The BCRP has been successful in maintaining low inflation, which averaged 2.5% per year between 2000 and 2016. The nuevo sol is a member of the Sistema de Tipo de Cambio Determinado (Determined Exchange Rate System), also known as the snake system. This system links the currencies of Peru, Colombia, and Ecuador. The nuevo sol is also pegged to the US dollar, with a rate of S/. 3.25 per US$1. Peru is a member of the Latin American Integration Association (LAIA), which uses the nuevo sol as its official currency. The LAIA is a regional economic organization that promotes economic integration among its member countries. Peru joined the LAIA in 1969. The LAIA’s other members are Argentina, Bolivia, Chile, Colombia, Ecuador, Mexico, Paraguay, Uruguay, and Venezuela.