Brazil had the cruzeiro as its currency before the real was introduced. The cruzeiro was the official currency of Brazil from 1942 to 1986, when it was replaced by the cruzado. However, due to high inflation rates, the cruzado was also replaced by the cruzado novo in 1989, and then finally by the cruzeiro real in 1993.
The cruzeiro was named after the Southern Cross constellation, which is present on the Brazilian flag. It was divided into 100 centavos and had several different denominations, including coins and banknotes. The cruzeiro went through several revaluations and denominations changes during its existence, as the country struggled with hyperinflation.
In 1994, the Real Plan was introduced in Brazil to stabilize the economy and combat inflation. As part of this plan, the real was introduced as the new currency of Brazil, replacing the cruzeiro real at a rate of 1 real to 2,750 cruzeiros reais. The real was pegged to the US dollar for several years to help maintain stability in the Brazilian economy.
The introduction of the real marked a significant turning point for Brazil’s economy, as it helped to bring inflation under control and restore confidence in the country’s financial system. The real quickly became one of the most stable and widely used currencies in South America.
Despite its turbulent history, the cruzeiro remains an important part of Brazil’s economic and monetary history. It serves as a reminder of the challenges that the country faced in the past and the efforts that were made to overcome them. Today, the real continues to be the official currency of Brazil and plays a crucial role in the country’s economy.