Description
The dinar was introduced in 1960, having been established as a unit of account in 1958. It replaced the franc at a rate of 1000 francs = 1 dinar. The dinar did not follow the devaluation of the French franc in 1958, thus the exchange rate peg was abandoned. Instead a peg to the United States dollar of 1 dinar = 2.38 dollars was established which was maintained until 1964, when the dinar devalued to 1 dinar = 1.90 dollars. This second rate was held until the dollar was devalued in 1971.
Tunisia had a historically low inflation. The dinar was less volatile in 2000–2010 than the currencies of its oil-importing neighbors, Egypt and Morocco. Inflation was 4.9% in fiscal year 2007–08 and 3.5% in fiscal year 2008–09.[citation needed] However, the value of the currency has been falling since then, and between 2008 and 2018, the dinar depreciated by about 55% against the U.S. dollar, from 76¢ to 34¢, and about 46% against the euro, from 55 cents to 30 cents.
