The Cape Verde escudo has been pegged to the Portuguese escudo at a rate of 55:1 since 1998 and, therefore, is fairly stable. In January 1999 the pegged currency was transferred to the euro at CVE 110.265:1 euro. The Banco de Cabo Verde, the central bank, gained additional
| Exchange rates: Cape Verde | |
| Cape Verdean escudos per US$1 | |
| Dec 2000 | 123.080 |
| 2000 | 115.877 |
| 1999 | 102.700 |
| 1998 | 98.158 |
| 1997 | 93.177 |
| 1996 | 82.591 |
| SOURCE : CIA World Factbook 2001 [ONLINE]. | |
autonomy in constitutional reforms made in July 1999. Its main functions are to control the money supply through the issue of currency and to regulate the commercial banks. However, most capital for development has had to come from foreign investment and aid, which the ruling MPD party has been consistently successful at attracting. The continuing high rate of inflation in Cape Verde is problematic, since it is higher than that of its main trading partner, Portugal, and thus raises Cape Verde's export prices, making them noncompetitive. Inflation stood at 4 percent in 2000.