The United Nations recognizes 180 currencies in the world as legal tender. But while currencies such as the US dollar and the euro are popular and widely used, they do not hold the highest values, and they are not the strongest currencies. When we talk about the , this refers to the relative purchasing power of a national currency when it is traded for products or against other currencies.
That is, currency strength is measured by the number of services and goods purchased and the sum of foreign currency received in exchange for one unit of the national currency. To determine the strength of a currency or if it is the most valuable currency in the world or the most expensive currency, we need to consider the interaction of a variety of local and international factors. This includes the supply and demand in the forex markets, inflation, growth in the domestic economy
1. Kuwaiti Dinar (KWD)
The highest currency in the world is none other than Kuwaiti Dinar or KWD. Initially, one Kuwaiti dinar was worth one pound sterling when the Kuwaiti dinar was introduced in 1960. The currency code for Dinars is KWD.
The most popular Kuwait Dinar exchange rate is the INR to KWD rate. The Indian expat community is very strong in Kuwait, hence the reason for being a popular currency pair. Kuwaiti Dinar has been the highest currency in the world for a while now because of the following reasons.
Reasons:
Oil exports: Kuwait is one of the world’s largest exporters of oil, which is a valuable commodity. This gives Kuwait a strong economic foundation and supports the value of the KWD.
Fixed exchange rate: The KWD is pegged to a basket of currencies, which includes the US dollar, the euro, and the Japanese yen. This means that the value of the KWD is not as susceptible to fluctuations in the global currency markets.
Political stability: Kuwait is a politically stable country, which is another factor that attracts foreign investment and helps to support the value of the KWD.
Currently, one KWD is valued at 270.97 in INR. Check the most updated KWD to INR rates and KWD TO INR forecast 2023-2022
2. Bahraini Dinar (BHD)
The Bahraini Dinar or BHD is the currency of Bahrain. Located in the Arabian Gulf, Bahrain is heavily reliant on oil exports. The most popular Bahrain Dinar exchange rate is the INR to BHD rate. The currency code for Dinars is BHD, and the currency symbol is BD.
Indians are the largest expat group in Bahrain and that explains the reason for INR to BHD popularity. Bahrain attracts expats from all over the globe because of being the second-highest currencyin the world.
Reasons:
Oil exports: Bahrain is a major exporter of oil and gas, which are two of the most valuable commodities in the world.
Fixed exchange rate: The BHD is pegged to the US dollar at a fixed exchange rate. This means that the value of the BHD is directly tied to the value of the US dollar.
Low inflation: Bahrain has a pretty low inflation rate, which helps in keeping the value of the BHD stable.
Currently, one BHD is valued at 221.69 in INR. Check the most updated BHD to INR rates and BHD TO INR forecast 2023-2024.
3. Omani Rial (OMR)
The Omani Rial or OMR is the currency of Oman. Before 1940, Oman used INR as its official currency and this is why the most popular Rial exchange rate is INR to OMR Rate.
Situated on the southeastern coast of the Arabian Peninsula, Oman’s economy mostly relies on the oil reserves that they have. The Omani rial is divided into 1,000 smaller divisions, known as baisa, unlike most other currencies. Oman’s currency is pegged to the US Dollar, however, besides this, there are also other reasons why it is the 3rd highest currency in the world
Reasons:
Oil exports: Oman is a major exporter of oil and gas, which are two of the most valuable commodities in the world.
Low inflation: Oman has a relatively low inflation rate, which helps to maintain the value of the OMR.
Currently, one OMR is valued at 216.12 in INR. Check the most updated OMR to INR rates here and OMR TO INR forecast 2023-2024.
4: Jordanian Dinar (JOD)
The Jordanian dinar or JOD is the currency of Jordan. In 1950, the currency replaced the Palestinian pound as Jordan’s official currency. West Bank used the Jordanian Donar and the Israeli shekel as well.
The most popular Jordan Dinar exchange rate is the JOD to EUR rate. Here’s why the currency is 4th strongest currency in the world. Fixed exchange rate: The JOD is pegged to the US dollar at a fixed exchange rate. This means that the value of the JOD is directly tied to the value of the US dollar.
Diversified economy: Jordan has a relatively diversified economy, which is not overly reliant on oil exports. This makes the JOD less susceptible to fluctuations in the global oil market.
Currently, one JOD is valued at 117.29 in INR.
5: Gibraltar Pound
The Gibraltar pound or GIP is the currency of Gibraltar. It is pegged to – and exchangeable with – the British pound sterling at par value. Hence, both GIB and GBP are accepted in Gibraltar. The central bank controlling the GIP, with the responsibility of minting coins and printing notes, is the Government of Gibraltar.
The most popular Gibraltar Pound exchange rate is the EUR to GIP rate. The currency is the 6th highest currency in the world, here’s why
Reasons:
Fixed exchange rate: The currency is pegged to the British Pound: Due to this, GIP currency is supported by the strength of the UK economy.
Strong and stable economy: It is a major financial center and a popular tourist destination. This helps to support the value of the GIP even further.
Currently, one Gibraltar Pound (GIP) is equal to 101.45 in Indian Rupees.
6: British Pound
The pound sterling (£) or GBP is the currency of Great Britain and is the 5th strongest currency in the world. It is also the official currency of Jersey, Guernsey, the Isle of Man, South Georgia and the South Sandwich Islands, the British Antarctic Territory, and Tristan da Cunha.
The most popular United Kingdom Pound exchange rate is the EUR to GBP rate. Sterling is the fourth most-traded currency in the foreign exchange market, after the United States Dollar, the Euro, and the Japanese Yen. USD/GBP is the world’s third most traded currency pair and is commonly known as “cable”. Here’s why the currency is the 5th highest currency in the world
Reasons:
Strength of the UK economy: The UK is the sixth largest economy in the world by GDP, and it has a diversified economy with a strong services sector.
Stability of the UK government:The UK is a stable democracy with a long history of political stability. Investors are more likely to invest in countries with stable governments.
Independence of the Bank of England: The Bank of England is independent of the government, which means that it can make decisions about interest rates and other economic policies without political interference.
7: Caymanian Dollar
The Cayman Islands Dollar is the currency of the Cayman Islands. The most popular Cayman Islands Dollar exchange rate is the USD to KYD rate.
Jamaican Dollar was in place till 1972 but then the Cayman Islands Dollar was put in as the official currency. The abbreviation of the currency is CI$. Currently, the value of KYD makes it the 7th highest currency in the world.
Reasons:
Fixed exchange rate: KYD is pegged to the US dollar at a fixed exchange rate, so the Cayman Islands dollar is supported by the strength of US economy.
Strong economy: The Cayman Islands itself has a strong economy, and pegging the dollar to the US dollar also helps to maintain stability.
Low debt-to-GDP ratio: The country has a low debt-to-GDP ratio, which means that the government is in a strong financial position and is able to repay its debts.
Currently, one KYD is valued at 99.25 in INR.
8: Swiss Franc: CHF
The Swiss Franc is the currency of Switzerland and Liechtenstein. Switzerland is one of the of the world’s most stable and wealthy countries. The most popular Switzerland Franc exchange rate is the EUR to CHF rate.
The Swiss franc is also the 8th most traded currency in the world, here’s why.
Reasons:
Switzerland’s political and financial stability: Switzerland is one of the most politically and financially stable countries in the world. This makes the Swiss franc a safe haven currency for investors in times of economic uncertainty.
Switzerland’s strong economy: Switzerland has a strong economy with low unemployment and inflation. This makes the Swiss franc a desirable currency for businesses and investors.
Switzerland’s central bank policy: The Swiss National Bank (SNB) has a strict monetary policy aimed at maintaining price stability. This helps to keep the Swiss franc strong.
Currently, one CHD is valued at 90.32 in INR. Check out the most updated CHF to INR rates and CHF TO INR forecast 2023-2024.
9: Euro: EUR
The Euro or EUR is the official currency of the eurozone, which consists of 19 of the 27 member states of the European Union: Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.
Euro is the second largest reserve currency after the US Dollar. It is also the second most traded currency in the world. Euro is one of the strongest currencies and ranks 9th in this list.
Reasons:
Strength of the eurozone economy: The eurozone is the second-largest economy in the world, after the United States, which gives the euro a pretty strong foundation.
Political stability: The eurozone is generally considered to be a politically stable region. This is important for investors, who are more likely to invest in currencies from stable countries.
Low-interest rates: Interest rates in the eurozone are typically lower than interest rates in the United States and other countries.
However, there are also a few factors that weigh on its value such as Government debt, inflation and political uncertainty. As a result, the euro ranks 9th in the list of the world’s strongest currencies.
Currently, one EUR is valued at 87.24 in INR. Check out the most updated EUR to INR rates and EUR TO INR forecast 2023-2024.
10: United States Dollar: USD
The US Dollar is the Currency of the United States of America. The most popular United States Dollar exchange rate is the USD to EUR rate. It is the most traded currency in the world.
Almost every central bank and commercial bank holds it as the world’s primary reserve currency. It is said that no currency will ever replace the US Dollar as the most traded currency. It is a global currency that is backed by the power of US in the global political landscape. However, when ranked among the world’s strongest currencies, it comes 10th.
Reasons:
Inflation: The US has a higher rate of inflation than many other countries, meaning that the dollar’s purchasing power declines over time.
Trade deficit: The US has a trade deficit, meaning that it imports more goods and services than it exports. This can put downward pressure on the value of the dollar.
Interest rates: Interest rates in the US are typically lower than interest rates in many other countries. This can make the dollar less attractive to investors.
Despite these reasons, The United States of America (USA) is considered as the most powerful nation in the world. Over the years, the strength of USD has increased massively. This is due to the size and strength of the US economy, as well as the US’s role in global politics and finance.
Currently, one USD is valued at 83.27 in INR. Check out the most updated USD to INR rates and USD TO INR Forecast 2023 – 2024
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About the Author:
Vipin Kumar