Brazilian Real

Name of currency: Brazilian real

Country / countries used: Brazil

Symbol: R$

Brief history:

The need for currency in Brazil became evident following the arrival of the Portuguese settlers in the 16th century, bringing gold, silver and copper coins with them for trade the colonisers also traded with pirates along the coastline encouraging the circulation of various foreign coins. Over time the Spanish real, brought across from Peru, became the most commonly used coinage but due to the vast range of different currencies used coins were valued purely on their precious metal content. Because of this lack of a specifically Brazilian currency the government would frequently establish particular wares as their legal tender for example sugar was set as the commodity of trade in 1614 by the governor of Rio de Jainero, other items such as tobacco, coffee, cocoa, clove and cotton were also used for money exchange purposes in other parts of brazil, even ‘zimbo’ (a type of seashell from the Brazilian coast) was used for trade amongst the slaves brought over from Africa.

Centuries passed and the Brazilian citizens began to see the necessity of producing their own coinage and so came about The City of Bahia Mint. It took a while before the gold coins already in circulation where re-printed to become the official national currency, the real grew in demand and soon more mints popped up across the country, finally resulting in the first paper bill being produced in 1772. Real stood its ground as the national currency until 1942 when the ‘cruzeiro real’ (CR$) came into place.

The real as we know today wasn’t introduced until 1994 as part of a plan known as ‘Plano Real’ from the president of the time Itamar Franco and the then Minister of Finance, Fernando Henrique Cardoso, to stabilize the Brazilian economy. This not only replaced the existing currency but also involved a demonetization of the cruzeiro real and made a huge large scale banknote replacement scheme essential. The plano real aimed to put an end to brazils difficulties with decades of extensive inflation and was supposed to be valued equally to the US dollar 1:1 but devalued rigorously over a few short years to the point of 4:1 in 2002, with a slight upturn the rate in terms of money exchange has stayed in the region of 2 Brazilian real to 1 US dollars  since 2006.