5 Centavos – Mexico

In 1954, Mexico faced a severe currency crisis rooted in persistent balance of payments deficits and a loss of confidence in the peso. Following World War II, the government of President Miguel Alemán (1946-1952) had pursued aggressive industrialization and infrastructure spending, financed largely by borrowing and monetary expansion. This led to high inflation, which the government tried to control through a fixed exchange rate of 8.65 pesos per U.S. dollar, established in 1949. However, the overvalued peso made Mexican exports expensive and encouraged imports, draining foreign reserves and creating a unsustainable economic imbalance.

The situation came to a head under President Adolfo Ruiz Cortines. By early 1954, Mexico's foreign exchange reserves were nearly exhausted, and speculative pressure against the peso intensified. Despite assurances from the government that a devaluation would not occur, the economic fundamentals made it inevitable. On April 17, 1954, the Mexican government announced a sharp, one-time devaluation, moving the fixed rate to 12.50 pesos per dollar—a devaluation of approximately 44%. This decisive action was intended to resolve the crisis permanently and restore stability.

The 1954 devaluation proved to be a pivotal and successful economic adjustment. By making Mexican goods more competitive, it corrected the external imbalance and laid the groundwork for a period of sustained growth known as "Desarrollo Stabilizador" (Stabilizing Development). For the next 22 years, the peso maintained its fixed parity at 12.50 to the dollar, becoming a symbol of Mexico's economic stability and a key anchor for the country's remarkable industrial expansion during the 1950s and 1960s.