The Mexican Peso: An Essential Guide

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Whether you are sending money home to Mexico or planning a vacation there, you may want to turn your U.S. dollars, Canadian dollars, British pounds, or other currency into Mexican pesos.

For the current peso-to-dollar (or dollar-to-peso) exchange rate,  check out today’s rates with Remitly.

While you might already know that the Mexican peso is the national currency of Mexico, you may not know that it used to be widely accepted as legal tender in the U.S., Canada, and even some Asian nations. 

The fact is, the Mexican peso isn’t just banknotes and coins. It also serves as a link to history in the Americas. 

Keep reading to learn more about the Mexican peso, from fun facts to practical considerations. 

Mexican peso essentials

mexican peso

About the Mexican Peso

The Mexican peso is the official currency of Mexico and is the third-most-popular currency in the Americas, after the U.S. and Canadian dollars. Its roots trace back to Spain, and it was the first currency to introduce design measures to prevent counterfeiting. 

The Mexican peso is issued by the Bank of Mexico. Bills are printed by the Bank of Mexico, and coins are minted by the Casa de Moneda de México.

  • Currency code: MXN
  • Abbreviation: $ or Mex$, ¢ for centavos

Mexican pesos are produced in the form of coins and banknotes.

Coin denominations:

  • 5, 10, 20, and 50 centavos
  • 1, 2, 5, and 10 pesos

Banknote denominations:

  • 20; 50; 100; 200; 500; and 1,000 pesos

The Mexican peso has several local nicknames, including “lucas,” “lana,” “marimba,” “money,” “morlacos,” “papiros,” and “varos.” 

The 1,000-peso banknote is not very common, but it does exist. If you do come into contact with one, know that most small stores will not accept it because they will not be able to make a change for it.

Related: The best ways to send money to Mexico

A Short History of the Mexican Peso

The peso had its origins in a common coin imported from Europe during colonization — a coin called the “Spanish dollar,” which was made of silver and worth eight Spanish real. (The coin was also known as “a piece of eight” for that reason.) In Mexico, the coin came to be called the “peso.”

For decades after Mexico gained its independence from Spain in 1821, the Mexican government continued to use the Spanish monetary system.

The first one-peso coin was issued in 1866 under Emperor Maximilian I. Departing from the tradition of the reales, each peso was made up of 100 centavos.

Gradually, the gold and silver content of the coins was replaced with less expensive metals. In 1905, the gold content of the peso was reduced by nearly 50%. This was followed by a reduction in silver. From 1918 to 1977, the weight and fineness of all silver coins declined, until the last silver peso coins were issued in 1977.

Throughout most of the 20th century, the Mexican peso was one of the more stable currencies in Latin America. However, the late 20th century was difficult for the Mexico peso. The 1970s oil crisis devastated the Mexican economy. Not only did the country default on its national debt, but wealth left the country and the peso suffered from inflation.

The government later stepped in to create the economic strategy known as the Stability and Economic Growth Pact. To combat further devaluation, they introduced the “nuevo peso” (“new peso”) in 1993. A single nuevo peso equaled 1,000 old pesos.

Once the old notes and coins were out of circulation in 1996, the currency dropped the term “nuevo.” 

6 Facts You Might Not Know About the Mexican Peso

mexico peso

While you might think that currency is pretty straightforward or even boring, every coin or banknote has a story. This is especially true for a currency with as much history as Mexico’s. 

Below are a few of our favorite facts about Mexico’s money.

1. Peso literally means “weight.”

Peso is Spanish for “weight.” This word can be traced back to the Latin “pensum,” meaning “something weighed,” from the verb “pendere,” meaning “to weigh.”

When you consider that the peso used to be made of precious metals like gold and silver, it makes sense that the coin would be valued by weight.

This is also why pesos were commonly referred to as peso oro (gold weight) or peso plata (silver weight).

2. The Mexican peso and the U.S. dollar have a shared history.

It’s easy to see the “$” sign and think of the U.S. dollar, but it was the Mexican peso that first used the “$” symbol for their coins!

The “$” sign is thought to originate from the abbreviation “PS,” which was used to denote Spanish pesos in the Americas.

The reason the peso uses the same symbol as the dollar is because they share a common history. During the colonization of the Americas, Spain had the largest supply of silver — which is why the original peso was made from silver.

The U.S. dollar was created in 1792, establishing the dollar as the principal unit of currency in the United States. It was modeled after the peso because of the peso’s international reputation and stability. Even after the dollar was created, the peso was still legal tender in the United States until 1857.

3. Mexico’s peso was an early model currency.

The Mexican peso was not only issued before the American dollar, but it also inspired the dollar’s design. Because of its resistance to counterfeiting, in fact, the peso was extremely popular during the 19th century.

It’s no surprise, then, that many global currencies took their design cues from the peso. These included the Hong Kong dollar, the Japanese yen, and the Chinese yuan.

4. The first peso banknotes weren’t printed in Mexico.

While the Bank of Mexico prints the modern-day peso, that wasn’t always the case. In their first round, the Mexican peso was printed by the American Bank Note Company of New York (ABNC) from 1925 to 1934. 

The Bank of Mexico told ABNC what they wanted on each note and sent images from their archive when possible.

Today, this is who you’ll find on some peso banknotes:

  • $1,000: Miguel Hidalgo, the Mexican hero who initiated Mexico’s independence.
  • $500: Benito Juárez, the former Mexican president who was the first Mexican president of indigenous origin.
  • $200: Both Miguel Hidalgo and José María Morelos y Pavón, leaders and revolutionaries who fought for Mexico’s independence.
  • $100: Nezahualcóyotl, a philosopher, architect, poet, ruler, and warrior.
  • $50: José María Morelos, Mexican Roman Catholic priest and revolutionary.
  • $20: Former Mexican president Benito Juárez.

5. It’s really hard to make counterfeit pesos.

Peso banknotes are designed and printed to prevent counterfeiting. For example, every note has a hidden watermark, holographic threads, and micro-prints.

Furthermore, except for the $20 and $50 notes, all notes are printed on special banknote paper. This has the same feel or texture as U.S. or Canadian dollars. 

The newest notes are made of plastic composite, making them very difficult to replicate.

6. The peso is a liquid currency.

The Mexican peso is a formidable currency on the international market for three reasons: 

  1. Mexico has historically had higher interest rates than the U.S., which can attract funds into higher-yielding Mexican government bonds and investments. 
  2. The physical proximity of Mexico to the U.S. means those border towns engaging in commercial interactions significantly increase the liquidity of the peso.
  3. Mexico is one of the largest oil producers in the world, contributing to international trade while allowing Mexico to finance its domestic endeavors.

Recommended reading: What Countries Use Dollars?


Peso-to-Dollar Conversion

For current dollar-to-peso conversion rates, check out today’s rates with Remitly.

To learn more about how exchange rates are calculated, this guide to exchange rates answers all of your questions.

About Mexico

The United Mexican States, as it is officially known, is a large country located in southern North America and is the third-largest country in Latin America. Sharing a northern border with the United States of America and a southern border with Belize and Guatemala, the country is home to over 128 million people. The federal republic is made up of 32 states. 

The federal government is housed in the capital and largest city, Mexico City. Mexico City is one of the most populous (at 8.5 million) and most metropolitan cities in the world. 

More than half the population of Mexico lives in the center of the country, whereas the arid areas to the north and tropical regions to the south are sparsely populated.  

Mexico is one of the dominant economic, political, and social forces in Latin America. It has a rich and diverse history due to its physical environment, a mixture of ethnicities, and settlement histories.

Mexico’s population is as diverse as it is large: 62% of the population identifies as mestizo (or mixed race, often of Spanish and indigenous descent),  7% identify as indigenous, and 31% identify as being from another ethnic group. 

Spanish is the official national language and is spoken by the vast majority of the population. While less than 1% of indigenous Mexicans speak their ancestral language, there are more than 50 indigenous languages spoken by more than 100,000 people in Mexico. These include  Maya in the Yucatan; Huastec in Veracruz; Nahua, Tarascan, Totonac, Otomí, and Mazahua mainly on the Mesa Central; Zapotec, Mixtec, and Mazatec in Oaxaca; and Tzeltal and Tzotzil in Chiapas.

While there is no official religion in Mexico, over 82% of the country is Roman Catholic, with smaller populations of other Christian sects. 

Tourism continues to be a growing industry in Mexico, with many people flocking to its tropical beaches along both the Pacific and Atlantic coasts.

Mexico is also known globally for its holidays and traditions, like Día de los Muertos (Day of the Dead) and many holidays associated with the Christian religion, such as Carnaval, Easter, and Christmas. 

Sending Money to Mexico

You can send money to Mexico with Remitly. New customers may be eligible for a special offer on their first transfers.

Remitly makes international money transfers faster, easier, more transparent, and more affordable. Since 2011, over 5 million people have used our secure mobile app to send money home with peace of mind. Visit the homepage, download our app, or check out our Help Center to get started.

And with our coverage across Mexico from coast to coast, your recipients can pick up cash from familiar locations. These include OXXO, Elektra, Bancoppel, and more. You can also send money directly to a Mexican bank account or debit card.

Further Reading

Visit Remitly for more information on Mexican holidays and traditions, everything you need to know about volatility caused by inflation, and how to send money in your preferred language with the Remitly app