Paraguay is a country home to the grand Government Palace and the Museo del Barro, displaying ñandutí lacework and pre-Columbian ceramics. The Paraguay Guarani (PYG) is the Republic of Paraguay's national currency. It was first issued for circulation in 1944, and ever since then, the guarani suffered from severe inflation over its continuance. The name of the currency originated from Guarani, the main ethnic group and native indigenous language in the country. The symbol for the currency is ₲. The Paraguayan government approved the replacement of the peso in 1943, with the Paraguay guarani (PYG) as legal tender. The new currency was traded at a rate of one guarani to every 100 pesos meant to subdue inflation that was plaguing the republic.
Eventually, in 1960, when the guarani suffered from the same inflationary difficulties as its antecedent, the government was prompted to initiate a peg to the United States dollar (USD) with an exchange rate was one dollar to every 126 guaranies, which would continue until 1985. The currency's value underwent a rapid devaluation, so the Republic of Paraguay introduced higher denominations of coins and bills. In 1990, the first 50,000 guarani notes were circulated, succeeded by 100,000 guaranies in 1998. The guarani's value has continued to decline sharply ever since 1985.
In 2011, the Paraguayan government revealed plans for the nuevo guarani using the symbol N₲. Its exchange rate value would be one nuevo guarani per 1,000 guaraníes and wouldn't have high denomination notes. After a proposed two-year transition phase, the new money would be the single accepted currency.
Paraguay claimed independence from Spain in 1811, which gained recognition in 1842. The Republic of Paraguay is a landlocked country in South America that has experienced a string of dictatorships until 1989. The country saw its first multi-party democratic elections in 1993. The main export is soybeans, and Paraguay is the 6th largest producer worldwide. The 2019 World Bank data found that the country experienced annual gross domestic product (GDP) growth of 0%, with an inflation rate of 2.8%. Paraguay suffered from double-digit inflation in the early 2000s but has started to get this obstacle in check. This high inflation is partly due to the nation's foreign debt, which reached over USD 17.7 billion as of 2017. Also adding to the problem is a predicament with liquidity servicing in 1995.