Have you at any point in time thought about the top 10 strongest currencies in the world. Well, I am sure you’ve done enough research to determine which currency is the strongest in the world.
The first thing that comes to mind of many people today is that the British Pound, the US Dollar, or the Euro should be considered as the strongest currency in the world but am sorry to tell you they are not.
According to the United Nations, 180 currencies are recognized as legal money, but do you know which one is the strongest?
As used in this context, a strong currency means a currency that is the most expensive when compared to the world’s reserve currency, the US dollar. In other words, you will receive the smallest currency return for 1 US dollar when you trade.
Top 10 Strongest Currencies In The World
Find out which currencies are the world’s 10 strongest currencies in the world in 2022, why they are strong, and why they are so highly valued in this article.
As of 2022, the following is a list of the top 10 strongest currencies in the world when compared to the US Dollar.
KWD (Kuwaiti Dinar)
The Kuwaiti Dinar is the world’s most powerful currency, ranking first in the world. The Kuwaiti Dinar was initially issued in 1960, when Kuwait gained independence from the British Empire, and it was worth one pound at the time.
Kuwait is a small country sandwiched between Iraq and Saudi Arabia in terms of geography. The current KWD exchange rate is $3.31, which means that if you trade one USD, you would only receive 0.30 Kuwaiti Dinar.
Kuwait’s currency has the highest value due to the country’s stable economy and the fact that it is an oil-rich country with 9% of the world’s oil reserves on its borders, according to wiki. Kuwait is significantly reliant on oil exports, which account for nearly all of the country’s revenue.
Production of petroleum products is simple in Kuwait, and the cost of production is the lowest in comparison to other countries. Kuwait is a tax-free country with a relatively low unemployment rate, which is an interesting statistic about the country. On the list of countries with the greatest GDP per capita, Kuwait is ranked eighth.
Bahraini Dinar (BHD)
The Bahraini Dinar (BHD) comes in second on the list of the world’s most valued currencies. The BHD conversion rate is $2.66 to one dinar, which means that if you trade one dollar, you will receive 0.37 BHD.
In 1965, BHD discontinued utilizing the Gulf rupee as legal money and replaced it with the Bahraini Dinar. The BHD is tied to the US Dollar, and the exchange rate has been quite steady with little volatility since 1987.
Bahrain has a population of about 1 million people. The export of gas and petroleum products is the most important source of revenue for this Persian Gulf island state, just like Kuwait.
Bahrain is one of the world’s leading oil producers, and pearl digging was the country’s most profitable sector. However, due to pearl cultivation in Japan, production was halted in the 1930s.
One curious fact is that the Riyal, the Saudi Arabian currency, is legally recognized as legal cash in Bahrain. The exchange rate remains steady at 1 Dinar = 10 Riyals.
Omani Rial (OMR)
The Omani Rial is the world’s third most costly currency. One Rial is worth 2.60 USD at the OMR conversion rate.
The Omani Rial was first introduced in 1970 as the Saidi Rial, after Oman’s sultanate, the House of Al Said. The OMR has been tied to the US Dollar since 1973.
Due to the great purchasing power of the Omani Rial, the government of Oman has printed 1/4 and 1/2 Rial banknotes. Oman, like the other gulf countries in the Middle East, is an oil-rich country that has developed into a developed economy with a high level of living.
Because oil supplies are rapidly dwindling, the government of Oman has decided to diversify its income from crude oil production to other industries such as metallurgy, gas development, and tourism.
Jordanian Dinar (JOD)
With a conversion rate of 1 JOD = 1.41 USD, the Jordanian Dinar, which has been the country’s currency since 1950, is ranked fourth on our list of the strongest currencies.
It was initially tied to the US Dollar at a greater rate, but the government has successfully maintained this peg for the past two decades.
Jordan is an emerging market with little economic development, thus there is no fundamental argument to justify its high valuation. Jordan lacks natural resources such as oil and coal, among others, and it also has a large external debt.
Jordan’s economic development has been slowing since 2011, owing to a significant increase in population, external debt, and unemployment.
British Pound (GBP)
The British Pound Sterling is the world’s fifth most powerful currency, with a conversion rate of 1 GBP = 1.38 USD. Many people believe that the British Pound has the highest monetary value, but this is not the case.
The British Empire was expanded over the globe before World War I, hence the GBP is the oldest currency in circulation.
The British pound is one of the most widely traded currencies in the world. Traders refer to the GBP/USD pair as “the cable” in the forex market, and it is the third most traded pair in the world behind EUR and JPY.
The pound sterling is the official currency of England, Scotland, Wales, and Northern Ireland. Guernsey, Jersey, and the Isle of Man are three British Crown Dependencies that utilize GBP as a parallel currency.
Few British colonies, such as the Falkland Islands, Gibraltar, and Saint Helena, have their own currencies that are valued one to one. The actual look of these paper currencies, however, differs from that of the Bank of England.
Cayman Islands Dollar
The Cayman Islands Dollar is the sole Caribbean currency in our list of strong currencies, coming in sixth place. The main reason for this is that it is a self-governing British territory that is regarded as one of the best tax havens in the world for corporations and individuals.
The Cayman Islands has a conversion rate of 1 KYD = 1.22 USD and is one of the top five offshore financial centers in the world.
Many banks, hedge funds, and insurance organizations are granted licenses to establish their businesses in the country.
European Euro (EUR)
With a conversion rate of 1.19 against the dollar, the Euro is ranked seventh on our list of the strongest currencies. 19 European countries use the Euro as their official currency.
After the US dollar, the Euro is the second most important reserve currency, accounting for 25% of all global deposits. Around 25 countries have set a fixed rate for their currencies to be tied to the Euro.
The EUR/USD pair, commonly known as “Fiber,” is the most traded currency pair, accounting for over 25% of daily activity. In addition, after the US Dollar, the Euro is the second most traded currency.
With a conversion rate of 1.08 to the dollar, the Swiss Franc is ranked eighth among our top currencies. The Swiss franc is one of the most stable currencies in the world and one of the least influenced by inflation.
Switzerland is one of the world’s wealthiest countries, with a rigorous monetary policy and low debt levels. One of the main reasons why it is a safe pick for investors when trading or saving currency is this.
The United States Dollar (USD)
Since the Breton Woods agreement in 1944, the US Dollar has been the “World Reserve Currency.” The most widely traded currency in the forex market is the US dollar.
Because it is accepted all throughout the world, the US dollar is always in high demand. More than 85% of everyday forex deals include the US dollar. The United States, with a GDP of more than $22 trillion, is the world’s economic engine.
As of September 2018, the value of the US dollar in circulation was 1.69 trillion dollars. Within the United States, just 30% of the currency is in circulation. There was a time when $1,000, $5,000, $10,000, and $100,000 bills were issued in the United States.
Bahamian Dollar (BSD)
Since 1966, the BSD has been the official currency of the Bahamas. The BSD is at par with the USD.
For the convenience of American tourists, many firms that cater to the tourism industry keep some additional US dollars on hand.