Economics

What is the Currency of Guatemala?

The official currency of Guatemala is the Guatemalan quetzal.

The official currency used in Guatemalan is the quetzal. The currency derives its name from a bird that is considered of great importance in many Mesoamerican countries called the resplendent quetzal. In ancient days, the people from this region used the tail feathers of the bird as currency. The quetzal is also Guatemala’s national bird. The currency is made up of 100 subunits known as cents or centavos. It is denoted as Q and its plural form is quetzals.

History

Before the introduction of the quetzal in Guatemala, Guatemalans used the peso. The currency was first issued in the country in 1925, under the reign of José Maria Orellana who was president. His image can be seen on the obverse of 1 quetzal notes. The currency used the standard of gold and so the quetzal could be exchanged for France’s franc.Later it became locally equal to the US dollar and until 1987 its value was fixed against that of the US dollar.

Coinage

Coins were first issued in the country in 1925. There were centavo coins in denominations of 10, 5 and 1. There were quetzal coins as well in denominations of 1, ½ and ¼. Shortly after, coins of 1 quetzal were recalled and melted. 1n 1932 the country introduced coins with values of ½ centavo and 2 centavos. All coins with a value of 5 centavos or more were made of 72% silver until 1966. The government reintroduced 50 centavo coins in 1998 and 1 quetzal coins went back into circulation in 1999. The two coins that were introduced in 1932 of ½ and 2 centavos are no longer in circulation.

Banknotes

The first quetzal bills in the country were issued by Guatemala’s Central Bank with values of 100, 20, 10, 5, 2, and 1 quetzal. 1n 1933, the bank issued the first ½ quetzal bills. The mandate to issue banknotes was taken from the Guatemalan Central Bank in 1946 and it was given to the Bank of Guatemala. The first banknotes issued by the bank were overprints of the previously Central Bank issued notes.

Notes with a value of 50 quetzales were introduced in 1967. All the bills remained in use until late in the 1990s when the ½ quetzal bill was replaced by the 50 centavo coin and the 1 quetzal bill was replaced by the 1 quetzal coin. All the banknotes have their values denoted in Mayan numerals on the obverse top-right corner. This is in honour of the county’s cultural heritage. On August 20 2007, the country introduced a new version of the 1 quetzal note made of polymer. The following year, a 5 quetzal bill made of the same material was also introduced.

Current Exchange Rate

The rate of exchange of the quetzal against the major currencies in the world is available in the money markets. Currently, 7.2875 GTQ are traded for $1. The rate of exchange against the Swiss franc is 1 CHF to 7.6373 GTQ and the exchange rate against the euro is 8.4247 quetzales against 1 EUR.

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