Peruvian Sol (PEN)

Basic Concepts of the Peruvian Nuevo Sol

The Peruvian Nuevo Sol is the legal tender of the Republic of Peru, with the currency code PEN and the symbol S/. Issued and managed by the Central Reserve Bank of Peru, it adopts a floating exchange rate system and is mainly traded in the international foreign exchange market with currencies such as the U.S. dollar and the euro.

Countries and regions of use

The Peruvian Nuevo Sol is the exclusive legal tender of Peru and is used throughout the country. In the border areas between Peru and neighboring countries, some merchants may also accept U.S. dollars for transactions, but official settlements are still based on the nuevo sol.

Units and Denominations

1 Nuevo Sol = 100 cents. Banknotes are available in denominations of 10, 20, 50, 100 and 200 nuevos soles, and coins are available in denominations of 1, 2 and 5 nuevos soles and 1, 5, 10, 20 and 50 cents. All banknotes feature portraits of famous Peruvian personalities and national symbols.

Historical background

The nuevo sol was initially pegged to the U.S. dollar in 1991, replacing the indian currency, which had been severely devalued by hyperinflation, and in 2005 a second version was issued with improved anti-counterfeiting technology. 2015 saw it become a fully convertible currency, and in recent years the exchange rate has remained relatively stable, making it one of the more robust currencies in Latin America.

Currency Features

Polymer and cotton paper mixed material, equipped with holographic strips, watermarks, fluorescent fibers and other anti-counterfeiting technology. The coins use a bimetallic inlay process, in which the center of the 1 Nuevo Sol coin is a copper-nickel alloy and the outer ring is aluminum bronze.

Economic Impact

As the currency of account for Peru's mineral exports, which are the backbone of the Peruvian economy, the nuevo sol exchange rate is highly correlated with international commodity prices such as copper and silver. The Central Bank of Peru maintains exchange rate stability through foreign exchange interventions to support the country's tourism and foreign trade.