20 Korun / Korún – Czechoslovakia

In 1937, the currency situation in Czechoslovakia was one of relative stability and strength, especially when compared to the turbulent economies of many of its European neighbours. The Czechoslovak koruna (Kč), established upon the country's founding in 1919, was a symbol of the First Republic's economic resilience and prudent fiscal management. Backed by substantial gold and foreign exchange reserves managed by the National Bank of Czechoslovakia, the koruna was a fully convertible "hard currency" with a fixed exchange rate under the gold standard. This discipline fostered significant foreign investment, particularly from France and Britain, and made Czechoslovakia a leading industrial exporter in Central Europe.

However, this stability existed under growing political and economic shadows. The Great Depression had hit the country's export-oriented industries hard, particularly in the predominantly German-speaking Sudetenland, fuelling ethnic tensions exploited by Nazi Germany. While the central bank successfully defended the koruna's parity, it came at the cost of deflationary pressure and higher unemployment in certain regions. Furthermore, the government's substantial military spending from 1936 onward to counter the rising German threat began to strain public finances, though not yet critically impacting the currency's external value.

Ultimately, the soundness of the koruna in 1937 was a testament to Prague's strong institutions, but it was increasingly vulnerable to external political forces beyond its control. The currency's fate was inextricably linked to the republic's territorial integrity. The Munich Agreement of September 1938 and the subsequent dismemberment of the state would shatter the economic foundations, leading to the separation of the Slovak and Bohemian-Moravian currencies and the end of the resilient koruna as it had existed in 1937.