Chapter 4

CURRENCY NOTES OF THE
PALESTINE CURRENCY BOARD

          The currency notes of the Palestine Currency Board were introduced on Monday, 1 November 1927, and included the denominations of 500 mils (P), and P1, P5, P10, P50 and P100. These were the first currency notes issued for Palestine.

This series of currency notes ended up being the only series, and throughout all the years of the Mandate and the activity of the Currency Board, notes were issued with no changes in design, only the dates and the signatures of Board members.



Value of Notes in Circulation in P 

 

Fiscal year

500 mils P1 P5 P10 P50 P100 Total

Increase/Decrease

1928 206,000 765,000 410,000 160,000 98,000 53,500 1,692,500 0.00%
1929 161,769 731,712 402,935 165,050 98,150 26,300 1,585,916 -6.30%
1930 153,577 888,043 562,920 225,080 97,200 21,600 1,948,420 22.86%
1931 104,385 999,943 648,770 231,880 88,350 12,000 2,085,328 7.03%
1932 117,779 985,514 643,815 244,710 76,850 9,500 2,078,168 -0.34%
1933 181,679 1,164,856 751,825 310,960 70,200 8,400 2,487,920 19.72%
1934 254,645 1,532,740 1,226,075 564,270 68,250 5,600 3,651,580 46.77%
1935 297,599 1,839,844 1,611,575 958,100 90,150 11,900 4,809,168 31.70%
1936 295,610 2,025,230 1,974,355 1,188,340 136,700 44,700 5,664,935 17.79%
1937 301,909 2,031,230 1,701,355 962,340 76,200 20,600 5,093,634 -10.08%
1938 298,509 1,926,530 1,484,355 734,340 53,400 14,700 4,511,834 -11.42%
1939 384,854 2,457,821 1,949,245 1,046,470 170,200 23,800 6,032,390 33.70%
1940 477,825 2,785,821 2,581,535 1,686,090 295,800 14,600 7,841,671 29.99%
1941 639,717 3,716,346 3,014,890 2,154,980 611,050 13,500 10,150,483 29.44%
1942 705,698 5,464,702 3,766,665 2,603,300 575,250 13,500 13,129,115 29.34%
1943 1,125,206 9,893,099 7,496,760 5,687,490 802,400 46,100 25,051,055 90.81%
1944 932,057 12,494,508 11,564,275 9,228,930 1,092,000 75,700 35,387,470 41.26%
1945 712,049 11,449,583 15,534,205 13,626,730 1,208,500 145,700 42,676,767 20.60%
1946 843,544 9,579,528 16,762,940 16,021,280 1,165,000 142,200 44,514,492 4.31%
1947 854,956 8,928,469 17,127,660 17,010,660 1,235,500 179,500 45,336,745 1.85%
1948 936,406 9,413,578 19,546,150 20,041,280 1,028,850 158,700 51,124,964 12.77%
1949 589,362 3,795,913 10,156,100 8,391,630 411,450 85,400 23,429,855 -54.17%
1950 172,445 2,334,607 4,957,170 7,364,355 332,050 52,500 15,213,127 -35.07%
1951 105,263 746,913 1,531,295 1,959,930 73,500 7,500 4,424,401 -70.92%
1952 68,533 225,744 126,470 160,570 20,300 1,600 603,217 -86.37%

At the end of the first fiscal year of the operation of the Palestine Currency Board with the introduction of new notes (31 March 1928), the value of the notes in circulation was P1,692,500. At the end of the last fiscal year of the Currency Board's activity (31 March 1952), the value of the notes in circulation was P603,217.

The peak value of the notes in circulation was recorded surprisingly in 1948, and stood at P51,124,964. This statistic can be explained by the large amount of money poured into Palestine for the payment of salaries for government employees immediately prior to the disbanding of the government, alongside reserves sent to the Amman branch of the Ottoman Bank as part of its conversion to a Board Agent (see Chapter 10). The low point in value of notes in circulation was recorded in 1952, the last year of the Board's operation.

The peak of increase of value of the notes in circulation was recorded in 1943, with the incredible increase of 90.81%, almost double that of the previous year. As stated above, General Montgomerys victory brought a sigh of relief and a feeling that the war was moving away from the area. Public confidence in the banks was slowly reviving and the increase of cash deposits in the banks led in turn to an increase of cash in circulation. The lowest point of increase of value of the notes in circulation, 1952, showed a decrease of 86.37%.

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Number of Notes in Circulation 

Fiscal year

500 mils P1 P5 P10 P50 P100 Total

Increase/Decrease

1928 412,000 765,000 82,000 16,000 1,960 535 1,277,495 0.00%
1929 323,538 731,712 80,587 16,505 1,963 263 1,154,568 9.62%-
1930 307,154 888,043 112,584 22,508 1,944 216 1,332,449 15.41%
1931 208,770 999,943 129,754 23,188 1,767 120 1,363,542 2.33%
1932 235,558 985,514 128,763 24,471 1,537 95 1,375,938 0.91%
1933 363,358 1,164,856 150,365 31,096 1,404 84 1,711,163 24.36%
1934 509,290 1,532,740 245,215 56,427 1,365 56 2,345,093 37.05%
1935 595,198 1,839,844 322,315 95,810 1,803 119 2,855,089 21.75%
1936 591,219 2,025,230 394,871 118,834 2,734 447 3,133,335 9.75%
1937 603,818 2,031,230 340,271 96,234 1,524 206 3,073,283 -1.92%
1938 597,018 1,926,530 296,871 73,434 1,068 147 2,895,068 -5.80%
1939 769,708 2,457,821 389,849 104,647 3,404 238 3,725,667 28.69%
1940 955,650 2,785,821 516,307 168,609 5,916 146 4,432,449 18.97%
1941 1,279,434 3,716,346 602,978 215,498 12,221 135 5,826,612 31.45%
1942 1,411,396 5,464,702 753,333 260,330 11,505 135 7,901,401 35.61%
1943 2,250,411 9,893,099 1,499,352 568,749 16,048 461 14,228,120 80.07%
1944 1,864,113 12,494,508 2,312,855 922,893 21,840 757 17,616,966 23.82%
1945 1,424,098 11,449,583 3,106,841 1,362,673 24,170 1,457 17,368,822 -1.41%
1946 1,687,087 9,579,528 3,352,588 1,602,128 23,300 1,422 16,246,053 -6.46%
1947 1,709,912 8,928,469 3,425,532 1,701,066 24,710 1,795 15,791,484 -2.80%
1948 1,872,811 9,413,578 3,909,230 2,004,128 20,577 1,587 17,221,911 9.06%
1949 1,178,724 3,795,913 2,031,220 839,163 8,229 854 7,854,103 -54.39%
1950 344,891 2,334,607 991,434 736,436 6,641 525 4,414,533 -43.79%
1951 210,527 746,913 306,259 195,993 1,470 75 1,461,237 -66.90%
1952 137,066 225,744 25,294 16,057 406 16 404,583 -72.31%

The peak in the number of notes in circulation was recorded in 1944, and stood at 17,616,966. This number reflected the inflation in Palestine at the end of WWII, and the plethora of circulating notes of lower denominations, particularly the P1 note 12,494,508, some 71% of the total amount of notes in circulation. The low point of the amount of notes in circulation was recorded in 1952, the last year of the Board's operation. The increase and decrease in the amount of notes in circulation was consistent with the date of increase and decrease of the value of the notes in circulation.

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Circulation: P compared to amount of notes 

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Change in circulation: P compared to amount of notes 

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