The Uruguayan peso has declined in value since the 1990s, mainly due to inflation. In 1994, 5.0439 pesos equaled US$1; by 1999 the peso had declined to 11.3393 per dollar. In an effort to maintain the value of the peso, the Uruguayan Central Bank uses its reserves to purchase dollars.
Monetary policy is overseen by the nation's Central Bank, which also issues currency. The Central Bank is not independent, but is subject to control and influence by the government. Almost 90 percent of bank deposits and transactions in Uruguay are done in U.S. dollars. Uruguay's financial reserves declined in 1999 by US$13 million as a result of the government's deficit. In 2000, the reserves totaled US$2.4 billion, or enough to service the nation's debt for at least 2 years.