could a government ever have a “reset” on currency?

Question

And by a reset on currency I mean a reset on the value of their currency. Take Iranian rial for example, their exchange rate is 371,992 to a single U.S. dollar. Could a rial ever have a 1:1 ratio without ever collapsing? I obv not a finance bro

In: Economics

Answer 1

Yes, it happens from time to time. I was in Mexico like 25 years ago when they switched the Peso so that rather than 5000:$1, it went to 5:$1. Old Peso was accepted at 1/1000 face value, New Peso had correct value. People had like a year to swap out old bills for new ones.