What is the strongest currency in the world?
Although the United States is the richest country in the world and has the biggest economy, the USD is not the most valuable currency in the world. It is, however, the strongest and most traded currency. The currency crowned as the highest in the world is the Kuwaiti Dinar (KWD) as it is the most expensive to exchange against other currencies, and it has held that position for the last while. It would cost you about $3.25 USD to get 1 Kuwaiti Dinar.
Here's a rundown of the world's top 12 currencies:
The conversion rates are to give you a general idea, based on the rates for August 2023. Find updated conversion rates in Google Finance here.
#1 Kuwaiti Dinar (KWD)
1 KWD = $3.25 USD
1 USD = 0.30 KWD
Although Kuwait is quite a small country it plays a big role in the global oil export market. It is therefore one of the richest countries, and continues to have the strongest currency in the world.
#2 Bahraini Dinar (BHD)
1 BHD = 2.65 USD
1 USD = 0.37 BHD
Also a country that made it rich by exporting oil. It ranks second on the list, with the second strongest currency in the world.
#3 Omani Rial (OMR)
1 OMR = 2.60 USD
1 USD = 0.38 USD
Oman is also known for its large oil export. It also revenues on a strong agriculture market.
#4 Jordanian Dinar (JOD)
1 JOD = 1.41 USD
1 USD = 0.70 JOD
Unlike the above mentioned countries, Jordan doesn’t have any oil, but oil isn’t the only element that creates a strong currency. There are quite a few other factors that come into play including economic stability and diversity. Jordan has a diversified economy including trade, manufacturing, and mining, which serves their currency well making it one of the most valuable in the world.
#5 Pound Sterling (GBP)
1 GBP = $1.28 USD
1 USD = 0.80 GBP
The Pound is the official currency of the United Kingdom, and it is also the oldest currency that still exists. Given the size of Britain’s economy it comes as no surprise that it has the highest currency value outside the Middle East.
#6 Gibraltar Pound (GIP)
1 GIP = $1.27 USD
1 USD = 0. 79
The Gibraltar Pound is the official currency of Gibraltar, a British overseas territory. It is traded for the British Pound at face value, and that’s why its exchange rate is similar to the GBP.
#7 Caymans Islands Dollar (KYD)
1 KYD = $1.20 USD
1 USD = 0.83 KYD
The Cayman Islands has very favorable tax policies. Therefore, it has become a major tax haven and financial center, attracting many wealthy individuals and institutions who keep their wealth there.
#8 Swiss Franc (CHF)
1 CHF = $1.14 USD
1 USD = 0.88
Switzerland is one of the wealthiest countries in the world, and since their economy is considered very stable and safe it is one of the most traded currencies.
#9 Euro (EUR)
1 EUR = $1.09 USD
1 USD = 0.92 EUR
The euro is the second most used and traded currency after the US Dollar. It is the official currency of 19 European countries including some major economies.
#10 US Dollar (USD)
1 USD = $1.00 USD
The US Dollar is the most used and traded currency in the world. It is also the world’s reserve currency with most countries’ central banks holding their reserves in USD. The reason for this is, because the US has the biggest economy on the planet, and the currency is backed by the USA who is considered to be the most powerful nation in the world.
#11 Canadian Dollar (CAD)
1 CAD = $1.35 USD
1USD = 0.74 CAD
Canada is the second largest exporter of uranium and crude oil. Due to its close connection to the US through trade the Canadian Dollar fluctuates according to the USD. It is also a popular reserve currency because of Canada’s political stability.
#12 Australian Dollar (AUD)
1 AUD = $0.64 USD
1 USD = 1.52 AUD
The Australian Dollar is the fifth most traded currency in the world. This is due to its big economy ranked as the 13th biggest GBT. It is also considered a very stable currency.
What makes a currency strong?
The exchange rate is based on supply and demand just like any other commodity. There are a lot of factors that contribute to the increase of demand in a currency thus raising its value. Some key factors include interest rates, economic performance, and political stability. When a country has high interest rates it increases demand for their currency because it is attractive for investors. Good economies and stability are also important factors in the value of a currency.