New Zealand Dollar

Name of currency: New Zealand Dollar

Country / countries used: New Zealand, Cook Islands, Niue, Tokelau, Pitcairn Islands

Symbol: $

Brief history:

The New Zealand dollar, with the code NZD, is one of the ten most traded currencies in the world. It is sometimes written as ‘NZ$’ and is informally called the ‘Kiwi.’ Prior to the dollar, New Zealand used the British pound until 1967, when the currency was switched to the decimal system. A committee decided on the system in 1964 and then passed The Decimal Currency Act, which set the currency transition year to 1967. Another currency change will happen in New Zealand with a conversion to ‘Nauru’ with Australia. The conversion is set for 25 May 2013.

With the beginning use of the dollar, coins came in 1 cent, 2c, 5c, 10c, 20c, and 50c. All coins featured an image of Queen Elizabeth II. In 1967, a more traditional design for the coins was leaked to the public and, facing a negative reaction, designers changed quickly to something more contemporary. In 1991, $1 and $2 were put into circulation instead of the notes. On 11 November 2004, the New Zealand Reserve Bank announced the desire to take the 5c coin out of circulation, and the change was carried out over a period beginning on 31 July 2006.

In 1967, the original notes in circulation were in denominations of $1, $2, $5, $10, $20 and $100. The $50 note was added in 1983, and the $1 and $2 notes were replaced by coins. The currency experienced another change in 1999 when polymer notes replaced paper notes, following Australia’s lead. The new polymer notes are safer, longer lasting and are recyclable. The design of the actual note is very similar to its design in paper form, with a few minor adjustments for added security.

The New Zealand dollar is under the direction of the Reserve Bank, and modelled after the U.S. dollar. Its foreign exchange rate with the U.S. dollar started with US$1.62 equal to NZ$1. The rate lowered with the devaluation of the British pound, and changed constantly until 2009 when it bottomed out at US$0.50. A strong rebound rate and a switch to a different currency show that the economy will prevail after all.

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