Economics

What is the Currency of Lithuania?

The official currency of Lithuania is the euro.

Introduction of the Euro

Lithuania is a country in Europe and one of the three Baltic States. Presently, the currency used in Lithuania is the euro. The euro is coded as EUR and used with the sign €. However, until January 2015, its currency had been the Lithuanian litas (LTL). The Bank of Lithuania is responsible for the country's currency, in collaboration with the European Central Bank.

Lithuanian Litas

The government first introduced the litas in 1922. The litas replaced the German ostmark and ostruble, known as auksinas in Lithuania, which were used during World War I. However, in 1939 Nazi Germany forced Lithuanians to use its currency, and therefore the reichsmark replaced litas as the official currency. In 1941, there was a currency switch from litas to rubles when Lithuania was taken over by the Soviet Union. In 1993, the litas became the official currency once again. From 1994 to 2002, the Lithuanian litas was pegged to the US dollar at a fixed rate of 4 litas for every 1 US dollar. From 2002 to 2015, Lithuania pegged its currency to the euro at a fixed rate of 3.4528 litas for 1 euro. The Central Bank still uses this fixed exchange rate. Lithuania's recent switch from the litas to the euro was delayed by persistent high inflation and economic crisis.

Banknotes and Coins

At the time of the adoption of the euro, the subunits of the litas were 1/100 centas. The first Lithuanian coins were designed by sculptor Juozas Zikaras, who lived between 1881 and 1944. He made ten denominations of coins. However, the coins which were used before the adoption of euro coins were 1, 2, 5, 10, and 50 centai and 1, 2, and 5 litai. The metals used to mint coins over the years have been aluminium, bronze, cupro-nickel, bimetallic, and nickel-brass. On the other hand, litas banknotes were first issued in 1922. They had the portrait of Lithuania’s coat of arms. Those banknotes were of poor quality which made them easy to counterfeit. The most commonly used banknotes before the euro currency were 500, 200, 100, 50, 20, and 10 litų.

More in Economics