Nicaragua - Money

Inflation has seriously eroded the value of the nation's money, the córdoba. In 1991, inflation reached 750 percent which made the currency relatively worthless since what had previously cost 1 córdoba cost 750 córdobas. Although inflation has been reduced to 12 percent, it is still high by international standards. For example, the rate of inflation in the United States in 2000 was 3.4 percent. In 1999, it took 12.29 córdobas to equal US$1. In 1995, the rate was 7.55 córdobas per US$1. Inflation has been the main reason for the decline in value of the córdoba.

The country's stock market, known as the Bolsa de Valores de Nicaragua, was established in 1993 and began operations in 1994. By 1997, the exchange was worth US$690 million. However, unlike in most countries where the stock market is dominated by private companies, in Nicaragua government-issued bonds accounted for 81 percent of trades while private-company securities only accounted for the remaining 19 percent of volume. The nation has 10 brokerage firms, all of which are associated with local banks.

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