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Modern drachma

This article is about the modern currency. For the currency of ancient Greece, see Ancient drachma.

The drachma (Greek: δραχμή [ðraxˈmi]) was the official currency of modern Greece from 1832 until the launch of the euro in 2001.

Drachma
Δραχμή (Greek)
Modern drachma coins; Top row, left to right: 10λ coin, 20λ coin, 50λ coin, 1 δρ. coin, 2 δρ. coin. Middle row, left to right: 5 δρ. coin, 10 δρ. coin, 20 δρ. coin, 50 δρ. coin. Bottom row, left to right: 100 δρ. coin, 500 δρ. coin.
ISO 4217
CodeGRD
Unit
Pluraldrachmai (until 1982), drachmes (since 1982)
Symbol₯ (δρ. or δρχ.)‎ also Δρχ. or Δρ.
Denominations
Subunit
 1⁄100leptοn
Plural
 leptοnlepta
Symbol
 leptοnλ
Banknotes
 Freq. used200 δρ., 1,000 δρ., 5,000 δρ., 10,000 δρ.
 Rarely used50 δρ., 100 δρ., 500 δρ.
Coins
 Freq. used5 δρ., 10 δρ., 20 δρ., 50 δρ., 100 δρ., 500 δρ.
 Rarely used10λ, 20λ, 50λ, 1 δρ. and 2 δρ.
Demographics
ReplacedPhoenix
Replaced byEuro
User(s)None, previously:
Greece Greece
Issuance
Central bankBank of Greece
 Websitewww.bankofgreece.gr
PrinterBanknote and Securities Printing Foundation
MintBanknote and Securities Printing Foundation
Valuation
Inflation3.1% (2000)
 SourceGrecian.net
EU Exchange Rate Mechanism (ERM)
SinceMarch 1998
Fixed rate since19 June 2000
Replaced by euro, non cash1 January 2001
Replaced by euro, cash1 January 2002
1 € =340.750 δρ.
This infobox shows the latest status before this currency was rendered obsolete.

First modern drachma

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The drachma was reintroduced in May 1832, shortly before the establishment of the Kingdom of Greece.[1] It replaced the phoenix at par. The drachma was subdivided into 100 lepta.[n 1]

Coins

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The first coinage consisted of copper denominations of 1 lepton, 2 lepta, 5 lepta and 10 lepta, silver denominations of 1⁄4 drachma, 1⁄2 drachma, 1 drachma and 5 drachmae and a gold coin of 20 drachmae. The drachma coin weighed 4.5 g and contained 90% silver, with the 20 drachmae coin containing 5.8 g of gold.

In 1868, Greece joined the Latin Monetary Union and the drachma became equal in weight and value to the French franc. The new coinage issued consisted of copper coins of 1, 2, 5 and 10 lepta, with the 5- and 10-lepton coins bearing the names obolos (ὀβολός) and diobolon (διώβολον), respectively; silver coins of 20 lepta, 50 lepta, 1 drachma, 2 drachmae and 5 drachmae and gold coins of 5, 10 and 20 drachmae. (Very small numbers of 50- and 100-drachma coins in gold were also issued.)

In 1894, cupro-nickel 5-, 10- and 20-lepton coins were introduced. No 1- or 2-lepton coin had been issued since the late 1870s. Silver coins of 1 and 2 drachmae were last issued in 1911, and no coins were issued between 1912 and 1922, during which time the Latin Monetary Union collapsed due to World War I.

Between 1926 and 1930, a new coinage was introduced for the new Hellenic Republic, consisting of cupro-nickel coins in denominations of 20 lepta, 50 lepta, 1 drachma, and 2 drachmae; nickel coins of 5 drachmae; and silver coins of 10 and 20 drachmae. These were the last coins issued for the first modern drachma, none were issued for the second.

Notes

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Notes were issued by the National Bank of Greece from 1841 until 1928. The Bank of Greece issued notes from 1928 until 2001, when Greece joined the Euro. Early denominations ranged from 10 to 500 drachmae. Smaller denominations (1, 2, 3 and 5 drachmae) were issued from 1885, with the first 5-drachma notes being made by cutting 10-drachma notes in half.

When Greece finally achieved its independence from the Ottoman Empire in 1828, the phoenix was introduced as the monetary unit; its use was short-lived, however, and in 1832 the phoenix was replaced by the drachma, adorned with the image of King Otto of Greece, who reigned as modern Greece's first king from 1832 to 1862. The drachma was divided into 100 lepta. In 2002 the drachma ceased to be legal tender after the euro, the monetary unit of the European Union, became Greece's sole currency.

From 1917 to 1920, the Greek government took control of issuing small change notes under Law 991/1917. During that time, the government issued denominations of 10 and 50 lepta, and 1, 2 and 5 drachmae. The National Bank of Greece introduced 1,000-drachma notes in 1901, and the Bank of Greece introduced 5,000-drachma notes in 1928.

 
Banknote of 1912 issued by the NBG

The economic depression of the 1920s affected many nations around the globe, including Greece. In 1922, the Greek government issued a forced loan in order to finance their growing budget deficit. On 1 April 1922, the government decreed that half of all bank notes had to be surrendered and exchanged for 6.5% bonds. The notes were then cut in half, with the portion bearing the Greek crown standing in for the bonds while the other half was exchanged for a new issue of central bank notes at half the original value.[2] The Greek government again issued notes between 1940 and 1944, in denominations ranging from 50 lepta to 20.

 
5-drachma note that has been cut in half by government for the purpose of issuing bonds

During the German–Italian occupation of Greece from 1941 to 1944, catastrophic hyperinflation caused much higher denominations to be issued, culminating in 100,000,000,000-drachma notes in 1944.[3] The Italian occupation authorities in the Ionian Islands printed their own currency, the Ionian drachma.

Greek banknotes of the 1942–1944 inflation[4]
Image Pick
No.[5]		 Denomination Date
Issued
118 1,000 1942
119 5,000 1942
120 10,000 1942
121 50 1943
122 5,000 1943
123 25,000 1943
124 50,000 1944
125 100,000 1944
126 500,000 1944
127 1,000,000 1944
  128 5,000,000 1944
129 10,000,000 1944
130 25,000,000 1944
  131 200,000,000 1944
132 500,000,000 1944
  133 2,000,000,000 1944
134 10,000,000,000 1944
  135 100,000,000,000 1944

Second modern drachma

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See also: Hyperinflation in Greece
 
Banknote of 1944 issued by the NBG

On 11 November 1944, following the liberation of Greece from Nazi Germany, old drachma were exchanged for new ones at the rate of 50,000,000,000 old drachmae to 1 new drachma.[6] Only paper money was issued for the second drachma. The government issued notes of 1, 5, 10 and 20 drachmae, with the Bank of Greece issuing notes of 50, 100, 500, 1,000, 5,000 and 10,000 drachmae. This drachma also suffered from high inflation. The government later issued 100-, 500- and 1,000-drachma notes, and the Bank of Greece issued 20,000- and 50,000-drachma notes.

Third modern drachma

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On 9 April 1953, in an effort to halt inflation, Greece joined the Bretton Woods system. On 1 May 1954, the drachma was revalued at a rate of 1,000 old drachmae to 1 new drachma, and small change notes were abolished for the last time.[6] The third drachma assumed a fixed exchange rate of 30 drachmae per dollar until 20 October 1973: over the next 25 years, the official exchange rate gradually declined, reaching 400 drachmae per dollar.[6] On 1 January 2002, the Greek drachma was officially replaced as the circulating currency by the euro, and it has not been legal tender since 1 March 2002.

Third modern drachma coins

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The first issue of coins minted in 1954 consisted of holed aluminium 5-, 10- and 20-lepton pieces, with 50-lepton, 1-drachma, 2-drachma and 5-drachma pieces in cupro-nickel. 10-drachma coins of a brighter alloy were issued in 1959 and a silver 20-drachma piece was issued in 1960, replacing the corresponding banknotes. Coins in denominations from 50 lepta to 20 drachmae carried a portrait of King Paul (1947–1964). New coins were introduced in 1966, ranging from 50 lepta to 10 drachmae, depicting King Constantine II (1964–1974). A silver 30-drachma coin for the centennial of Greece's royal dynasty was minted in 1963. The following year a non-circulating coin of this value was produced to commemorate the royal wedding. The reverse of all coins was altered in 1971 to reflect the military junta which was in power from 1967 to 1974. This design included a soldier standing in front of the flames of the rising phoenix replacing the (royal) coat of arms and the date of the coup d'état, April 21, 1967.

A 20-drachma coin in cupro-nickel with an image of Europa on the obverse was issued in the first series of 1973, alongside unholed aluminium lepta coins (10 and 20 lepta). Following the abolition of the monarcy by the junta in June 1973, several new coin types were introduced: nickel-brass (50 lepta, 1 and 2 drachmae) and cupro-nickel (5, 10 and 20 drachmae). These coins carried the design of the phoenix rising from the flame on the obverse-but now without the soldier, a nod to the "liberalization plan" pursued by Papadopoulos, and used the country's new designation as the "Hellenic Republic", replacing the coins also issued in 1973 as the Kingdom of Greece with King Constantine II's portrait.

Following the downfall of the dictatorship, a new series of all 8 denominations was introduced in 1976 carrying images of Pericles, Democritus and Aristotle on the 20-, 10- and 5-drachma coins respectively and Georgios Karaiskakis, Konstantinos Kanaris and Markos Botsaris on the 1-drachma, 2-drachma and 50-lepton coins respectively. The 20- and 10-lepton coins would be the only circulating, non-commemorative coins to bear the post-1975 Coat of arms of Greece on the obverse.

Cupro-nickel 50-drachma coins were introduced in 1980, featuring Solon. Starting in 1982, all coins now bore the inscription drachmes rather than the katharevousa drachmai type, reflecting the resolution of the Greek language question. In 1986, aluminium-bronze 50-drachma coins were introduced, followed by new, smaller copper 1-drachma (Laskarina Bouboulina) and 2-drachma (Manto Mavrogenous) pieces in 1988 and aluminium-bronze coins of 20 drachmes (Ioannis Kapodistrias) and 100 drachmes (Alexander the Great) in 1990. In 2000, a set of 6 themed 500-drachma coins were issued to commemorate the 2004 Athens Olympic Games.[7]

Subdivision

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5-lepton coins were discontinued in the first series of 1973. 10- and 20-lepton coins were last minted in 1978 and the 50-lepton (half drachma) coin was last minted in 1986. By 1990, the lepton as a subdivision had become practically obsolete and the drachma itself was now used for small change—the prices of sundries were in the hundreds; its size and weight had been reduced in 1988 from 21mm, 4.1 grams to 20mm, 2.75 grams. The 2-drachma coin experienced similar changes.

Coins in circulation at the time of the adoption of the euro[8] were

  • 50 lepta (€0.0015)[n 2]
  • 1 drachma (€0.0029)[n 3]
  • 2 drachmes (€0.0059)[n 3]
  • 5 drachmes (€0.0147)
  • 10 drachmes (€0.0293)
  • 20 drachmes (€0.0587)
  • 50 drachmes (€0.147)
  • 100 drachmes (€0.293)
  • 500 drachmes (€1.47)

Up until the introduction of the euro, the Greek government did not attempt to redenominate the drachma (to a simple 100 old drachmes = 1 new drachma rate), something that could have possibly contributed in a smooth transition to the new currency. The transition proved challenging due to the fact that the exchange rate (340.750 to 1 euro) included lepta (despite the fact that lepta were not used in physical transactions) and that the 20- and 50-cent coins (also called "lepta"), which were very similar in size and composition (Nordic Gold as opposed to 92% copper 6% nickel 2% aluminium) to the 20-, 50- and 100-drachma coins, were initially deemed worthless (alluding to the pp of their drachma predecessors), allowing vendors to take advantage of psychological pricing.[9] The most obvious example is the retail price of a 500ml bottle of water: once costing 50 drachmes (€0.147 in 2002), the price was driven by inflation to 100 drachmes (€0.293);[10][11] but the introduction of the euro would increase the price to 0.50 euros, where it stands to date.

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Banknotes

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The first issues of banknotes were in denominations of 10, 20 and 50 drachmes, soon followed by 100, 500 and 1,000 drachmes by 1956. 5,000-drachma notes were introduced in 1984, followed by 10,000-drachma notes in 1995 and 200-drachma notes in 1997.

Banknotes in circulation at the time of the adoption of the euro[12] were

Banknotes of the Greek drachma (circa AD 2000)
Image Value Equivalent in Euro (€) Main Color Obverse Reverse Watermark
[1] 50 δρ. €0.1467 Blue Head of Poseidon Laskarina Bouboulina directing cannon fire at two Ottoman ships at Palamidi during the Greek War of Independence Head of the Charioteer of Delphi
[2] 100 δρ. €0.2935 Brown and violet (obverse); Maroon, green and orange (reverse) Head of Piraeus Athena; Christian Hansen's National and Kapodistrian University of Athens building Adamantios Korais; Arkadi Monastery, Crete Head of the Charioteer of Delphi
[3] 200 δρ. €0.5869 Deep orange Rigas Feraios; Feraios singing his patriotic song at lower right Nikolaos Gyzis's Krifo scholio ("secret school") Bust of Philip of Macedonia
[4] 500 δρ. €1.47 Deep green Ioannis Kapodistrias; Capodistrias's home on Corfu Old Fortress, Corfu City Head of the Charioteer of Delphi
[5] 1,000 δρ. €2.93 Brown Bust of Apollon of Olympia Myron's Discobolus; Temple of Hera, Olympia Head of the Charioteer of Delphi
[6] 5,000 δρ. €14.67 Deep Blue or Purple and yellow-green Theodoros Kolokotronis; Church of the Holy Apostles, Kalamata Karytaina, Arcadia Bust of Philip of Macedonia
[7] 10,000 δρ. €29.35 Deep purple Georgios Papanikolaou; microscope Asclepius Bust of Philip of Macedonia
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Encoding

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₯ drachma sign

A currency symbol consisting of a cursive delta and rho was created in 1999, but was never used in practice.[13] It has been included in Unicode since version 3.0 as U+20AF ₯ DRACHMA SIGN. This character should not be confused with the Attic numeral, U+10142 𐅂 GREEK ACROPHONIC ATTIC ONE DRACHMA, representing the ancient drachma.[14]

Restoration

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See also: Greek withdrawal from the eurozone

Several parties during the Greek government-debt crisis proposed leaving the Euro and reinstating the Drachma as Greece's currency. Examples include the Drachmi Greek Democratic Movement Five Stars, which was founded in 2013[15] and dissolved in 2015, and Popular Unity, which was founded in the wake of the 2015 Greek bailout referendum.

See also

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Notes and references

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Notes
  1. ^ Greek: λεπτά; plural of λεπτόν, lepton.
  2. ^ Minted but rarely used. Usually, prices were rounded up to the next multiple of 10 drachmes.
  3. ^ a b Not minted but remained legal tender (not in actual use in 2002).
References
  1. ^ "The first modern drachma coins catalog". Retrieved 2013-06-22.
  2. ^ "The Greek Financial Crises: Getting by with the Half-Drachmai | PMG". pmgnotes.com.
  3. ^ "Banknote Index". banknoteindex.com. Retrieved 2019-02-01.
  4. ^ pmg1. "PMG World Paper Money Values and Note Price Guide, search category:Greece and series:194". Paper Money Guide. Retrieved 20 September 2024.{{cite web}}: CS1 maint: numeric names: authors list (link)
  5. ^ Cite error: The named reference pmg1 was invoked but never defined (see the help page).
  6. ^ a b c "Chronology (1928–2003)". Bank of Greece (in Greek). Athens. Archived from the original on 15 February 2005. Retrieved 9 May 2020.
  7. ^ "Drachma Coins" (PDF). Bank of Greece (in Greek). Retrieved 10 February 2023.
  8. ^ "Bank of Greece - Coins in circulation". Archived from the original on 4 February 2005. Retrieved 2005-01-12.
  9. ^ "Οι 50 δραχμές έγιναν... 50 λεπτά". ΤΑ ΝΕΑ (in Greek). 2006-04-21. Retrieved 2023-11-07.
  10. ^ "Πόσο να πληρώνετε το νερό". ΤΟ ΒΗΜΑ (in Greek). 2008-11-24. Retrieved 2023-11-07.
  11. ^ "«Τρελές» τιμές επιβάλλουν κερδοσκόποι στις παραλίες". ΤΑ ΝΕΑ (in Greek). 1997-07-12. Retrieved 2023-11-07.
  12. ^ "History of Greek Banknotes". Greekcurrency.110mb.com. Archived from the original on 2020-03-09. Retrieved 2013-11-17.
  13. ^ Michael Everson (19 July 2010). "Proposal to change the glyph for the DRACHMA SIGN" (PDF).
  14. ^ fileformat.info Entry for (U+10142)
  15. ^ "Political Party Drachma 5 Launched". greekreporter.com. 9 May 2013.
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Preceded by Greek currency
1832–2001 		Succeeded by
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