Unidad de Fomento

The Unidad de Fomento (UF) is a Unit of account that is used in Chile. The exchange rate between the UF and the Chilean peso is now (today) constantly adjusted to inflation so that the value of the Unidad de Fomento remains constant on a daily basis during low inflation. It was created on January 20, 1968, for the use in determining principal (monetary item) and interest (constant real value non-monetary item) in international secured loans (monetary items) for development, subject to revaluation according to the variations of inflation. Afterwards it was extended to all types of bank loans (monetary items), private or special financing (monetary items), purchases (trade debtors/trade creditors being constant real value non-monetary items) or investments on installments, contracts (constant real value non-monetary items), and some special situations. Also it is used in legal standards such as the par value of stock/capitalization (constant real value non-monetary items) of companies, fines (payables being constant real value non-monetary items), etc. It has become the preferred and predominant measure for determining the cost of construction (variable items valued at Historical Cost being updated), values of housing (historical variable real value non-monetary items being updated) and any secured loan (monetary item), either private or of the Chilean government. Individual payments are made in Chilean pesos (the country's legal tender), according to the daily value of the UF.

For historical and current values of the Chilean Unidad de Fomento (UF), see valoruf.cl or the government's Central Bank of Chile.

A similar currency unit for use generally in payment of taxes, fines, or customs duty is the Unidad Tributaria Mensual (UTM) (literally: monthly tax unit).

For historical and current values of the Chilean Unidad Tributaria Mensual (UTM), see valorutm.cl