Brazil’s Currency
The official currency of Brazil is the real, and its symbol is R$. The pluralized form of the real is reais. It is further subdivided into centavos. One hundred centavos are equivalent to one real. The value of the real is currently sitting at about 42 cents USD. The Brazilian government has continually attempted to keep the value of the real low to stimulate trade and foreign investment but despite its efforts the currency continues to appreciate in relation to the US dollar.
The currency of Brazil has a long and changing history, and in fact the real was first used in Brazil during the period of 1690 to 1942. When the Portuguese first arrived in Brazil, it was the Portuguese real that was used as the accepted currency. For a time there was more than one currency used in Brazil, as Dutch settlers in the North were printing a currency called the real starting in 1654. In 1790 the real became the currency of Brazil. Just like modern times, the real was subject to high rates of inflation. So great was the inflation in fact that they were traded subsequently in mil reis (which is one thousand reis) and later in conto de reis (a million reis).
Following the massive inflation of the real, gold currency was used, starting in eigteenth century and continuing on into the beginning of the nineteenth century. A gold piece was one made of 22 carat gold and it weighed in at half an ounce. Silver currency was also used at this time, with the silver coins weighing in at five eigths of an ounce. During this time the real was still the currency, simply traded in gold and silver. The inflation continued on, and the real by 1926 had reached a point where it was valued at one US dollar equal to twelve thousand reis. By 1942 the real had been replaced by the cruzeiro in an effort to make calculations easier. The replacement value was one cruzeiro to one thousand reis.
The currency that we now know as the real was introduced in 1994. With a new monetary policy in place it was time to settle on the final (hopefully) version of the Brazilian currency. Part of the plan was an effort to bring a stability to the currency of the country. The value of the real was set to one Unidade real de valor. This was a unit of currency that was not traded. The Unidade real de valor or URV was valued at $2750 cruzeiros. Because of the removal of the cruzeiro, a massive exchange of paper money and coins needed to be implemented. While this was difficult, consider what would have happened if nothing was done; the current real’s value could be counted against its counterpart from the 1940’s with 18 zeros behind it. It would make the use of calculators with eight decimal places a little difficult.
There are now bills for the real in the denominations of 1, 2, 5, 10, 20, 50 and 100, similar to the US dollar. The real has been up and down in value, and from a low of 4 $R to one US dollar it has rebounded and as mentioned the government continues to try and curtail the increasing value of the currency.