Portugal Currency (Euro History + Facts)

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Portugal’s currency used to be the escudo, introduced in 1911 after the monarchy was overthrown. The country switched to the euro, the European Union’s common currency, in 1999 after meeting specific EU requirements. By 2002, the euro had fully replaced the escudo as Portugal’s currency.

Portugal Euro

The euro is divided into 100 cents, with coins available in denominations of 1, 2, 5, 10, 20, and 50 cents, as well as €1 and €2 coins. Banknotes are available in denominations of €5, €10, €20, €50, €100, €200, and €500.

This article explores the history of Portugal’s currency, tracing its development from early times under royal rule to its current form as the euro. It covers the changes in Portugal’s monetary system, including the significant transition to the European Union’s single currency.

Historical Journey of Portugal Currency

Portugal has a rich history of currency dating back to the Roman Empire. The first coins used in Portugal were Roman coins, which were used until the fall of the Western Roman Empire in 476 AD. After that, the Visigoths and the Moors also minted their own coins, but it wasn’t until the 12th century that Portugal started to mint its own coins, called dinheiro.

From 1139 to 1911, Portugal used various currencies. Initially, the Portuguese dinheiro was introduced by King Dom Afonso Henriques, with the mealha as half a dinheiro.

This system was based on the Roman currency, where twelve dinheiros equaled one soldo, and twenty soldos equaled one libra. King Dom Sancho I introduced the gold morabitino, and later, King Dom Dinis I introduced the silver tornês. 

In 1380, King Fernando I added new coins like the gold dobra and the silver real. Various other currencies like the Byzantine siliquae and the Moorish dirhem circulated alongside the dinheiro.

In the 15th century, Portugal became a powerful maritime nation with a vast empire stretching from Brazil to India. The currency used during this time was the real, which was the unit of currency of Portugal and the Portuguese Empire from around 1430 until 1911.

The real was subdivided into 1,000 reis, and was used throughout the Portuguese Empire, including Brazil, until the early 20th century.


From 1911 to 1999, after the Republican Revolution, the Portuguese escudo replaced the real at a rate of 1,000 réis to 1 escudo, subdivided into 100 centavos.

The escudo was used in Portugal, its African colonies until 1975, and in colonial Macau, which still uses the Macanese pataca. Timor-Leste used the Portuguese timor, then the timor escudo, while India used the Indian rupia and then the Indian escudo until 1961.

Since 1999, Portugal has used the euro, which replaced the escudo in circulation by 2002. Brazil reverted to the real after briefly using the Brazilian cruzeiro. Most of Portugal’s colonies adopted new currencies post-independence, like Timor-Leste with the American dollar and Mozambique with the metical.

Today, the euro is the official currency of Portugal and is used throughout the European Union. The euro is subdivided into 100 cents and is used by 19 of the 28 EU member countries.


Portugal’s transition to the euro in 2002 marked a key moment in its economic and EU integration. The journey began in 1986 with Portugal joining the European Economic Community, which became the EU. 

By 1998, Portugal fulfilled the criteria to adopt the euro, joining the initial group of eurozone countries. The euro started as electronic currency in 1999 and physical euro banknotes and coins replaced the escudo in 2002, with a dual circulation period until the end of February.

Euro Coins

The euro, introduced in 1999, is the official currency of the Eurozone, consisting of 20 member countries. It is divided into eight coin denominations, ranging from one cent to two euros, each featuring a common reverse side depicting a map of Europe. 

However, the obverse side varies among member countries, showcasing unique designs. In addition to Eurozone members, four European microstates (Andorra, Monaco, San Marino, and Vatican City) also use the euro with their own designed coins. The coins are minted at national mints, adhering to strict quotas, while the European Central Bank manages the common side. 

Over the years, the euro’s design has evolved, with changes in 2007 reflecting the EU’s enlargement and updates in 2017 for some denominations. The euro’s introduction aimed to foster economic and monetary union, contributing to stability and collaboration among member states. 

The coins incorporate security features, and their design considers tactile elements for the visually impaired. While national sides of regular coins can be updated every 15 years, commemorative coins may vary more frequently. As of 2023, 24 countries issue euro coins with their national sides, reflecting the diversity within the Eurozone.

Euro Bills

Euro banknotes, the common currency of the eurozone, have evolved since their 1999 inception. Initially, under ES1, these €5 to €500 notes featured a uniform design with the European flag, a map, and “euro” in Latin and Greek. 

The designs, by Robert Kalina, resulted from a 1996 competition. ES1, made of pure cotton, excluded non-EU Cyprus and Malta. ES2, or Europa series, introduced size changes and enhanced durability with updated security features. Reinhold Gerstetter redesigned the notes, featuring Mario Draghi’s signature post-March 2012.

Anticipated in 2024, the third series will redesign notes based on public-voted themes. Security features include confidential elements like holograms and watermarks.

The Europa series introduced Europa’s face, reflecting EU expansion and adding Bulgaria’s Cyrillic alphabet. Circulating since 2013, it phased out the €500 note due to concerns about criminal use.

Security features include watermarks, holograms, color-changing ink, and more, with consultation for the visually impaired. A 2021 plan outlines the next redesign with potential themes like “European culture.” 

The ECB monitors euro banknote circulation and stock, ensuring integrity since its 2002 introduction. The euro’s history involves expansion, formalized political authority through the Lisbon Treaty, and usage across multiple EU countries. The seven denominations feature stylized historical European architectural illustrations on both sides.

Inflation and Buying Power of Portugal Euro

According to World Data, over the past 62 years, from 1960 to 2022, Portugal’s inflation rate varied between -0.8% and 31.0%. In 2022, the inflation rate was 7.8%. 

The average annual inflation rate during this period was 8.1%, leading to an overall price increase of 10,422.72%. This means an item that cost 100 euros in 1960 would cost 10,422.72 euros in early 2023. As of November 2023, the year-over-year inflation rate was recorded at 1.5%.

Portugal’s economic forecast indicates a modest recovery following a challenging year in 2023. Economic growth has slowed, but the labor market remains strong with high employment rates. 

GDP growth is expected to recover gradually, with inflation projected to moderate, aligning with the euro-area average. The government balance is forecast to achieve a surplus of 0.8% of GDP in 2023, but will narrow over the next few years. 

GDP growth rates are predicted at 2.2% for 2023, 1.3% for 2024, and 1.8% for 2025. Inflation rates are expected to decrease from 5.5% in 2023 to 2.4% in 2025. Unemployment is projected to remain stable around 6.4% to 6.5%.

The economic slowdown hasn’t significantly impacted employment, which continues to grow, particularly in tourism, construction, and administrative services. Inflation is moderating, helped by declining energy prices, although wage growth could exert some pressure on service prices. 

The general government balance is expected to turn positive in 2023 due to robust labor markets and controlled government spending. However, public debt remains high at over 100% of GDP, though it is projected to decrease to 97.2% by 2025. 

The forecast indicates a balanced yet cautious economic outlook for Portugal in the near future.

Currency Usage in Portugal

If you’re planning a trip to Portugal, you’ll need to know a little bit about the country’s currency. Portugal uses the euro (EUR), which is divided into 100 cents. Banknotes come in denominations of €5, €10, €20, €50, €100, €200, and €500, while coins come in denominations of 1, 2, 5, 10, 20, and 50 cents, as well as €1 and €2.

Is USD Accepted in Portugal?

While some tourist-oriented businesses may accept US dollars, it’s always best to have euros on hand for your trip to Portugal.

Using euros will help you avoid any confusion or misunderstandings that may arise from currency exchange rates or fees. ATMs are widely available throughout the country, and most businesses accept credit cards, so you should have no trouble getting the euros you need for your trip.

Exchanging Currency in Portugal

If you’re traveling to Portugal, you’ll need to exchange your currency to euros. Here’s what you need to know about exchanging currency in Portugal.

Where can I exchange Portugal Currency?

You can exchange currency in Portugal at banks, exchange offices, and ATMs. Banks typically offer the best exchange rates, but they may charge a commission or have limited hours. Exchange offices may have more flexible hours, but they may charge higher fees. ATMs are widely available and convenient, but they may have withdrawal limits and foreign transaction fees.

Before you exchange currency, check the exchange rate to make sure you’re getting a fair deal. You can use online currency converters or check the rates at banks or exchange offices. Keep in mind that exchange rates fluctuate constantly, so it’s a good idea to exchange your currency as soon as possible.

What to know before exchanging currency in Portugal

Before exchanging currency in Portugal, remember to bring your passport for transactions at banks or exchange offices. Avoid airport exchanges due to higher rates and check for hidden fees at banks and exchange offices. 

Stay cautious of scams, particularly from street vendors. Use ATMs wisely, noting any fees and exchange rates, and opt for those in secure locations. Although credit cards are widely accepted, keep cash for small purchases or emergencies. 

ATMs are readily available for withdrawing euros with a debit card, but be mindful of potential fees from your bank for international transactions.

Choosing Between USD and Portugal Currency

If you’re planning a trip to Portugal, you may be wondering whether to use USD or the local currency, the euro. Here are some factors to consider when making your decision.

Exchange Rate

The exchange rate between USD and euro fluctuates constantly, so it’s important to check the current rate before making any transactions.

You can use an online currency converter like XE to get an idea of the current rate. Keep in mind that the rate you see online may not be the rate you get when exchanging money in person, as exchange offices and banks often charge fees.


Using Portugal currency is generally more convenient than using USD. Most businesses in Portugal, including restaurants, shops, and hotels, only accept euros. If you try to pay with USD, you may receive a poor exchange rate or be charged additional fees.

While many places in Portugal accept credit cards, it’s always a good idea to have some cash on hand for smaller purchases or in case of emergencies.

ATMs are widely available throughout the country, and you can use your debit card to withdraw euros. Just be aware that your bank may charge fees for international transactions, so it’s a good idea to check with them before you go.


When exchanging money, you should be aware of any fees that may be charged. Banks and exchange offices often charge fees for exchanging currency, and these fees can vary widely.

Some credit cards also charge fees for foreign transactions. To avoid unnecessary fees, it’s a good idea to research your options before you leave for your trip.


When traveling in Portugal, use these tips to manage your money effectively:

  • Withdraw cash using ATMs from reputable banks to avoid high fees, and prefer using a credit card with no foreign transaction fees for better exchange rates and fee savings. 
  • Stay informed about the current exchange rate and compare prices in both USD and euros to ensure fair deals. Keep cash for small purchases like snacks or public transportation, as some places might not accept credit cards for minor transactions. 
  • Lastly, avoid exchanging money at airports or tourist spots due to their higher fees and less favorable exchange rates.

By considering these factors and following these tips, you can make an informed decision about whether to use USD or Portugal currency on your trip.

Cost of Living in Portugal

If you’re planning to move to Portugal, it’s important to have an idea of the cost of living in the country. The cost of living in Portugal is generally lower than in other European countries, making it an attractive destination for expats. However, the cost of living can vary significantly depending on the city you choose to live in and your lifestyle.

Accommodation is one of the biggest expenses in Portugal. The cost of rent varies depending on the location, type of property, and the number of rooms.

In Lisbon, for example, the average monthly rent for a one-bedroom apartment in the city center is around €800-€1,200 (~$860-1300 USD). If you’re on a tight budget, you can find cheaper accommodation outside the city center.

The cost of food in Portugal is generally lower than in other European countries. You can expect to pay around €10-€15 for a meal at an inexpensive restaurant and around €25-€35 for a meal at a mid-range restaurant. If you’re on a tight budget, you can save money by shopping at local markets and cooking your meals.

Public transportation in Portugal is affordable and efficient. A single ticket on a bus or metro in Lisbon costs around €1.50. If you plan to use public transportation frequently, it’s worth buying a monthly pass, which costs around €35. Taxis are also relatively cheap, with an average fare of around €5 for a short ride.

The cost of utilities, such as electricity, gas, and water, varies depending on your usage and the location of your property. On average, you can expect to pay around €80-€120 per month for basic utilities in a small apartment.

Portugal has a good public healthcare system, which is free or low-cost for residents. If you’re not eligible for public healthcare, you can opt for private health insurance, which can cost around €50-€100 per month.

Overall, the cost of living in Portugal is affordable compared to other European countries. However, it’s important to keep in mind that the cost of living can vary significantly depending on your lifestyle and the city you choose to live in.

Don’t Get Scammed Tips

When traveling to Portugal, it’s important to be aware of the common scams that may occur. Here are some tips to help you avoid being scammed when dealing with currency in Portugal:

1. Know the exchange rate

Before exchanging currency, it’s important to know the current exchange rate. This will help you understand how much money you should be receiving when exchanging your currency.

You can check the current exchange rate online or by using a currency converter app. Be sure to compare rates at different exchange offices to get the best deal.

2. Avoid exchanging currency at airports or tourist areas

Currency exchange offices at airports or tourist areas may offer lower exchange rates or charge higher fees. It’s better to exchange currency at banks or exchange offices in the city center.

3. Be cautious when using ATMs

ATMs are a convenient way to withdraw cash, but they can also be a target for scams. Always cover the keypad when entering your PIN and check the card slot for any skimming devices. It’s better to use ATMs located inside banks or shopping centers.

4. Watch out for counterfeit currency

Counterfeit currency is a problem in Portugal, especially in tourist areas. Always check the bills you receive for signs of counterfeiting, such as blurry printing or missing security features. If you receive a suspicious bill, report it to the police.

5. Avoid using credit cards at small shops or street vendors

Small shops or street vendors may not have secure credit card terminals, which can put your personal information at risk. It’s better to use cash or a secure credit card terminal at larger stores or restaurants.

By following these tips, you can protect yourself from currency scams in Portugal and enjoy your trip with peace of mind.

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