Home News The R $ 200 note would be equivalent to a R $ 1,200 note in 1994


The R $ 200 note would be equivalent to a R $ 1,200 note in 1994

by Ace Damon

The R $ 100 note was launched on July 1, 1994, when the Real Plan became effective in Brazil. Today, 24 years later, the accumulated inflation since that day is 521%, according to the Broad National Consumer Price Index (IPCA).

In practice, this means that a note of R $ 100 in 1994 was worth the equivalent in goods and products to R $ 621. It is as if, to correct this distortion with rounded values, it was necessary to create a note of R $ 600.

We have not yet reached this point, but we will have a new note circulating in Brazil soon: the R $ 200 note. It will be printed by the maned wolf, a typical animal from the Brazilian cerrado. 450 million banknotes will be printed later this year, but the final release date remains to be seen.

The announcement was made by the Central Bank last Wednesday (29) and, as always, yielded a good amount of memes on the internet, but it also generated a series of doubts, concerns and even criticism. Understand the story.

Why create a $ 200 bill now?

As the inflation figures presented at the beginning of the text show, it is undeniable that our currency has lost value since it was launched. With that, it makes sense to create a higher note to try not to be so far behind due to the currency devaluation. In other words: the ballot’s debut was, in a way, something expected.

Continues after advertising

The National Monetary Council admitted that the measure was already foreseen in its plans, but avoided talking about inflation in its explanations. Instead, it focused on the other reasons that explain the creation of the note, as well as the timing of its implementation. After all, the accumulated inflation even influences the process, but there is a trigger that accelerated the release of the note: the pandemic.

The release of emergency aid increased the demand for physical money. At the same time, a phenomenon known as hoarding took place: with the climate of uncertainty about the future, the population tends to keep money in their homes, decreasing the banknotes in circulation and further increasing the demand for them. This process did not happen only in Brazil, but in several other countries.

In addition, a $ 200 bill helps the government to save on banknote prints. In other words, the moment proved to be favorable for putting into practice a measure that would probably be created sooner or later.

Reactions to the decision

For those who lived in Brazil in the 1980s, however, the $ 200 bill may sound like a nightmare. The era was marked by a period of hyperinflation so great that the zeros at the end of the banknotes increased dramatically until they were cut with the implementation of a new currency. This cycle was repeated several times (Cruzeiro, Cruzado, Cruzado Novo …) and only ended with the Real Plan. This memory generated fear in some that the new ballot would indicate a similar period, in which the real would be extremely devalued.

Although it may seem the same, the new measure does not drink from the same source. Despite the influence of inflation in the process, what is being taken into account is the accumulated of 25 years, not just the current value.

Continues after advertising

In fact, we are experiencing a period of historic downturn in the IPCA, which measures inflation – it is possible that it will end in less than 2% this year. The new note, therefore, is not a sign that we will face the 1980s again.

Even so, the measure was criticized by some for facilitating corruption and crimes such as money laundering, which usually happen with physical bills. For example: it will be easier to leave with suitcases of money around, since an amount in R $ 200 notes occupies half the space of the same amount in R $ 100 notes. Countries like India and the European Union, for example , recently implemented measures to discourage the circulation of physical money, mainly on higher notes, in favor of digital operations, exactly to avoid situations like these.

The Central Bank responded to the criticism by saying that it is not the notes that induce crime, and that these deviations will continue to happen regardless of the ballot used. Furthermore, it is not easy to compare Brazil with Europe, for example, when it comes to physical money vs. digital money. In 2018, a research found that banknotes were still the payment method most used by 60% of Brazilians. Their use is more common among low-income populations, who have fewer bank accounts – from them the greater demand for money in circulation.

Anyway, the internet did not forgive the measure, especially because, for the general public, it came unexpectedly. Some argued that the animal printed on the new note should be the caramel mutt, a classic of Brazilian streets:

The 200 note should have been the caramel doguinho, nothing represents Brazil more than he
I would even be sorry to spend the R $ 200 reais pic.twitter.com/XGIeePNRuw

Continues after advertising

– Kayak perfume 🤡 (@kaykycord) July 29, 2020

Continues after advertising

4 animals that represent 200 reais better than the maned wolf pic.twitter.com/lhrJf50glb

– Marcos Castro (@marcoscastro) July 29, 2020

Continues after advertising

Others made fun of the fact that the economic crisis is so ugly that having a R $ 200 bill “makes you privileged, yes”:

200 reais bill will be released // I remembered that I can’t even get the 100 bill. pic.twitter.com/kCzqXtNiJp

– Henrique (@ euhenrique99) July 29, 2020

Continues after advertising

As if that were not enough, they discovered that the Simpsons, once again, predicted the future: an episode of the series showed R $ 200 bills in an episode about Brazil:

Continues after advertising

Simpsons predicting the $ 200 bill pic.twitter.com/vHxGFqTVjx

– Thiago Gama (@ Thiago9Gama) July 29, 2020

Continues after advertising


Related Articles

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More