Hungarian pengő

The pengő (Hungarian: [ˈpɛŋɡøː]; sometimes written as pengo or pengoe in English) was the currency of Hungary between 1 January 1927, when it replaced the korona, and 31 July 1946, when it was replaced by the forint. The pengő was subdivided into 100 fillér. Although the introduction of the pengő was part of a post-World War I stabilisation program, the currency survived for only 20 years and experienced the most serious case of hyperinflation ever recorded.

Hungarian pengő
pengő  (Hungarian)
100 million trillion pengő (1946)
fillérfillérek (note: the plural is typically not used about currency)
Freq. used50, 100, 500, 1000, 10000, 100000, 1 million, 10 million, 100 million, 1 trillion P
10000, 100000, 1 million, 10 million, 100 million, 1 trillion milpengő
10000, 100000, 1 million, 10 million, 100 million b.‑pengő
Rarely used1 trillion b.‑pengő (never issued)
Rarely used5 P (withdrawn)
User(s) Kingdom of Hungary
 Republic of Hungary
Central bankHungarian National Bank
PrinterHungarian Banknote Printing Corp.
MintHungarian Mint Ltd.
(annualised rate, July 1946)
This infobox shows the latest status before this currency was rendered obsolete.


The Hungarian participle pengő means 'ringing' (which in turn derives from the verb peng, an onomatopoeic word equivalent to English 'ring') and was used from the 15th to the 17th century to refer to silver coins making a ringing sound when struck on a hard surface, thus indicating their precious metal content. (The onomatopoeic word used for gold coins is csengő, an equivalent of English 'clinking' meaning a sharper sound; the participle used for copper coins is kongó meaning a deep pealing sound.) After the introduction of forint paper money in Hungary, the term pengő forint was used to refer to forint coins literally meaning 'ringing forint', figuratively meaning 'silver forint' or 'hard currency'.[2]

At the beginning of the First World War precious metal coins were recalled from circulation, and in the early 1920s all coins disappeared because of the heavy inflation of the Hungarian korona. The name pengő was probably chosen to suggest stability. However, there was some controversy when choosing the name of the new currency, though the majority agreed that a Hungarian name should be chosen. Proposals included turul (a bird from Hungarian mythology), turán (from the geographical name and ideological term Turan), libertás (the colloquial name of the poltura coins issued by Francis II Rákóczi), and máriás (the colloquial name of coins depicting Mary, patroness of Hungary).

The denomination of the banknotes was indicated in the languages of ethnicities living in the territory of Hungary. The name of the currency was translated as follows: Pengö (pl. Pengö) in German, pengő (pl. pengi) in Slovak, пенгов (pl. пенгова) in Cyrillic script Serbo-Croatian, пенгыв (pl. пенгывов, later пенге) in Rusyn, and pengő (pl. pengei, later penghei) in Romanian. Later pengov (pl. pengova), the Latin script Serbo-Croatian version was also added.

The symbol of the pengő was P and it was divided into 100 fillér (symbol: f).


Introduction of the pengő

Interwar pengő
Banknotes5, 10, 20, 50, 100, 1000 P
Freq. used1, 5, 10, 20, 50 f, 1, 2, 5 P
Rarely used10, 20 P (never issued due to the Great Depression)
Date of introduction1 January 1927
This infobox shows the latest status before this currency was rendered obsolete.

After the First World War, according to article 206 of the Treaty of Saint-Germain, the Austro-Hungarian Bank (the joint bank of the Monarchy) had to be liquidated and the Austro-Hungarian krone had to be replaced with a different currency,[3] which in the case of Hungary was the Hungarian korona. This currency suffered a high rate of inflation during the early 1920s. A stabilisation program covered by League of Nations loan helped bring down inflation, and the korona could be replaced on 1 January 1927 by a new currency, the pengő, which was introduced by Act XXXV of 1925[4] It was valued at 12,500 korona, and defined as 3,800 to one kilogram of fine gold which meant that the pengő was pegged to the gold standard, however, without exchange obligation. In the beginning the cover ratio (which included gold and to 50% foreign exchange) was fixed at 20% which had to be raised to 33.3% within five years.[5] This goal was reached quickly: the cover ratio was 51% on 31 July 1930. Later it decreased somewhat due to the economic and financial crisis caused by the Great Depression. Until then the pengő was the most stable currency of the region.

After the Great Depression

First Vienna Award pengő
Freq. used1, 5 P
Rarely used50 f, 2 P (never issued)
Date of introduction2 November 1938
This infobox shows the latest status before this currency was rendered obsolete.

The effects of the Great Depression reached Hungary after 1930 and it hit predominantly agriculture. The pengő had to be devalued and the debt of the country increased. After a short period of recovery, the war preparations amongst which the most important was the Győr-program had loosened the financial and monetary discipline which in turn led to the depreciation of the pengő currency. The territories given back to Hungary by the First and Second Vienna Awards in 1938 and 1940 were economically less developed, which was an additional aggravating factor regarding the economic situation of the country.[citation needed]

World War II

WWII pengő
Banknotes2, 5, 10, 20, 100, 1000 P[lower-alpha 1]
Freq. used2, 10, 20 f, 1, 2 P
Rarely used5 P (commemorative only)
Date of introduction1939
This infobox shows the latest status before this currency was rendered obsolete.
Red Army pengő
Banknotes1, 2, 5, 10, 20, 50, 100, 1000 P
Date of introduction1944
This infobox shows the latest status before this currency was rendered obsolete.

The war caused enormous costs and, later, even higher losses to the relatively small and open Hungarian economy. The national bank was practically under government control, and the issue of money was proportional to the budget demands. By this time, silver coins disappeared from circulation, and, later, even bronze and cupro-nickel coins were replaced by coins made of cheaper metal. In the last act of the world war, the Szálasi government took control of banknote printing and issued notes without any cover, first in Budapest, then in Veszprém when Budapest had to be evacuated. The occupying Soviet army issued its own military money according to the Hague Conventions.


The pengő lost value after World War II, suffering the highest rate of hyperinflation ever recorded. There were several attempts to break down inflation, such as a 75% capital levy in December 1945. However, this did not stop the hyperinflation, and prices continued spiraling out of control, with ever-higher denominations introduced. The denominations milpengő (one million pengő) and b.-pengő (pronunciation: bilpengő, one trillion (1000000000000) pengő) were used to alleviate calculations, cut down the number of zeros and enable the reuse of banknote designs with only the colour and denomination name changed.

The hyperinflation was so out of control that, on average, it took 15 hours for prices to double and 4 days, 5 minutes and 38 seconds for the pengő to lose 90% of its original value.


The adópengő (lit. "tax pengő") was introduced on 1 January 1946 as an accounting unit for budget planning. However, from 8 July 1946, it was allowed to be used as legal tender. It was intended to retain its value as the pengő's fell. However, although its value rose dramatically relative to the pengő (finally reaching 2×1021 pengő), the adópengő nevertheless suffered severely from inflation. By July 1946, the adópengő became the only circulating currency as the pengő's value had fallen to such an extent that even the 100 million b.-pengő note was effectively worthless.

End of the pengő

The Hungarian economy could only be stabilized by the introduction of a new currency, and therefore, on 1 August 1946, the forint was reintroduced at a rate of 400000000000000000000000000000 (400 octillion) = 4×1029 pengő, dropping 29 zeros from the old currency. In effect, the total amount of circulating pengő notes had a value of less than 0.1 fillér (11000 forint). A more realistic comparison was the exchange rate with the adópengő, which was set at 200000000 (hence the 2×1021 ratio, mentioned above).[6] The exchange rate for gold was set at 13.21 forint per gram.


2 pengő, 1936

In 1926, coins of 1, 2, 10, 20 and 50 fillér and 1 pengő were introduced. The 1 and 2 fillér pieces were bronze, the 10, 20 and 50 fillér were cupro-nickel and the 1 pengő coins were 64% silver. In 1929, 2 pengő coins were introduced, also in 64% silver. Commemorative 2 and 5 pengő coins were also issued on anniversaries, with a non-commemorative 5 pengő coin issued in 1939.

During the Second World War, the 1 fillér ceased production, the 2 fillér coins were issued in steel and then zinc, the 10 and 20 fillér coins were minted in steel and the 1, 2 and 5 pengő pieces were of aluminium.

In 1945, the provisional government issued aluminium 5 pengő coins which were the last coins issued before the hyperinflation.

Paper money

10 pengő, 1926

The Hungarian National Bank issued the first series of 5, 10, 20, 50, 100 pengő banknotes in the last days of 1926. These were offset prints on watermarked paper (except for the 5 pengő note). The banknotes featured the outstanding people of Hungarian history on the obverse and either different sites of Budapest or paintings on the reverse: the banknotes also served educational purposes.

10 pengő, 1929

A new series of banknotes had to be printed soon to meet higher security standards. The engravings were executed and designed by Endre Horváth, Hungarian graphic artist. New 5, 10, 20, 50 and 100 pengő notes were printed and even a 1000 pengő banknote was added to this series - however, the latter had such a high value that a big proportion of the people hardly ever saw any. This new series had almost the same topic as the previous. On the other hand, the 5 pengő notes were soon replaced with silver coins.

10 pengő, 1936

After the Vienna Award, Hungary had to supply its recovered territories with money. Since increasing the amount of silver coins would have been too expensive, 1 and 5 pengő notes were issued in 1941 and 1938, respectively. These notes were of simple design and poor quality. Meanwhile, a series of new banknotes including 2, 5, 10 and 20 pengő denominations was issued. The design represented ornaments based on Hungarian folk art and people.

At the end of the Second World War, the Szálasi government and the occupying Soviet army issued provisional notes in the territories under their power without any cover.

10 million milpengő, 1946

In 1945 and 1946, hyperinflation caused the issuance of notes up to 100 million b.-pengő (100 quintillion or 1020 pengő). During the hyperinflation, note designs were reused, changing the colour and replacing the word pengő with first milpengő, then b.-pengő, to generate higher denominations. The largest denomination produced was 100 million b.-pengő (100 quintillion or 1020 pengő). The note was initially worth about US$0.20. Notes of one milliard b.-pengő (one sextillion or 1021 pengő) were printed but never issued.

10 million adópengő, 1946

The introduction of adópengő was an attempt to limit inflation. It slowed inflation somewhat, but did not stop the depreciation of the currency. Bonds were issued by the Ministry of Finance in denominations between 10000 and 100000000 adópengő. These simple design notes on low-quality paper became legal currency in the last months of the hyperinflation, almost completely replacing the pengő.

The enormous amount of paper consumed during the production of the inflation pengő notes caused a shortage of good quality security paper; this hindered the production of forint banknotes.

Historical exchange rates

Exchange rates (US$1 in pengő)
1 January 19275.26
31 December 19375.40
31 Mar 19415.06
30 June 194433.51
31 August 19451320
31 October 19458200
30 November 1945108000
31 December 1945128000
31 January 1946795000
31 March 19461750000
30 April 194659000000000
31 May 194642000000000000000
10 July 1946460000000000000000000000000000
Exchange rates (1 adópengő in pengő)
1 January 19461
1 February 19461.7
1 March 194610
1 April 194644
1 May 1946630
1 June 1946160000
1 July 19467500000000
10 July 19462000000000000000000000

See also


  2. (in Hungarian) (info on the etymology of the word pengő)
  3. Full text
  4. (in Hungarian) (the Law No. XXXV 1925 definition of the pengő value and related regulations)
  5. (in Hungarian) (Hungary in the 20th century)
  6. 8640/1946. M. E. számú rendelet a pengőnek és az adópengőnek forintra való átszámításánál irányadó értékarány megállapítása tárgyában. Magyar Közlöny 170/1946. szám. (Presidential order No. 8640/1946 on the setting of value ratio applicable when converting pengő and adópengő to forint. Hungarian Gazette 170/1946.
  7. (in Hungarian) Archived 2007-05-16 at the Wayback Machine
  8. (in Hungarian) Archived 2005-11-09 at the Wayback Machine
  9. (in English) "Archived copy". Archived from the original on 2008-06-07. Retrieved 2008-08-11.CS1 maint: archived copy as title (link)


  1. The 1000 P banknote was, along with 10 and 100 P notes, only issued as part of the Veszprém series, during which coins were never issued.

Further reading

  • Gyula Rádóczy; Géza Tasnádi (1992). Magyar papírpénzek 1848-1992 (Hungarian paper money 1848-1992). Danubius Kódex Kiadói Kft. ISBN 963-7434-11-9.
  • Károly Leányfalusi; Ádám Nagy (1998). Magyarország fém- és papírpénzei 1926-1998 (Coins and paper money of Hungary 1926-1998). Magyar Éremgyűjtők Egyesülete, Budapest. ISBN 963-03-6023-3.
  • Mihály Kupa id. dr. (1993). Corpus notarum pecuniariarum Hungariae I-II. (Magyar Egyetemes Pénzjegytár) (General Hungarian Banknote Catalog). Informatika Történeti Múzeum Alapítvány, Budapest. ISBN 963-04-3658-2.
  • Bomberger, W. A.; Makinen, G. E. (1980). "Indexation, Inflationary Finance, and Hyperinflation: The 1945–1946 Hungarian Experience". Journal of Political Economy. 88 (3): 550–560. doi:10.1086/260886. JSTOR 1831932.