12 Fiat Currencies with highest value in the world; US Dollar not listed among top 5

The United State’s Dollar is surprisingly not the currency with the highest value in the world today. Find out which are the world’s 20 strongest currencies in 2021, why are they strong and what makes them so richly valued.

Below is the list of the world’s 20 strongest currencies in comparison to the US Dollar as of 2021.

1. Kuwaiti Dinar: KWD

Kuwaiti Dinar is the world’s strongest currency in the world holding number one position. Kuwaiti Dinar was first launched in the year 1960 when it gained independence from the British empire and it was equivalent to one pound at that time.

Kuwait is a relatively very small country that is geographically located between Iraq and Saudi Arabia. KWD conversion rate is $3.31 which implies if you exchange one USD you will receive only 0.30 Kuwaiti Dinar.

The currency has the highest value because of Kuwait’s stable economy and it is an oil-rich country that has 9% of the global oil reserves located on its territory according to the wiki. Kuwait is heavily dependent on oil exports which contribute to almost 95% of the country’s revenue.

Production of petroleum products in Kuwait is easy and the production cost is the cheapest compared to other countries. An interesting fact about the country is that Kuwait is a tax-free country and the unemployment rate is very low. Kuwait is at number eighth position in the list of countries with the highest GDP per capita.

2.Bahraini Dinar: BHD

Bahraini Dinar (BHD) takes the second spot in the list of the most valuable currencies in the world. BHD conversion rate is $2.66 per one Dinar which implies you will get 0.37 BHD if you exchange one dollar.

BHD stopped using the gulf rupee as legal tender and introduced Bahraini Dinar in 1965. BHD is pegged to the US Dollar and since 1987 the exchange rate against the USD is pretty much stable with less volatility.

Bahrain has a population of approximately 1 million. Just like Kuwait, this Persian Gulf island state’s biggest source of revenue is from the export of gas and petroleum products.

Bahrain is one of the leading oil-producing countries, the major profit-gaining industry here was pearl mining. However, in the 1930s the production was stopped due to pearl cultivation in Japan.

One of the fascinating facts is that Saudi Arabian currency Riyal is officially a legal tender in Bahrain. The forex rate is constant at 1 Dinar which is equal to 10 Riyals.

3. Omani Rial: OMR

The Omani Rial is the third most expensive currency in the world. OMR conversion rate for one Rial is equal to 2.60 USD.

Omani Rial was introduced in 1970 as Saidi Rial named after the sultanate of Oman, The House of Al Said. Since 1973 OMR is pegged to the US Dollar.

The government of Oman has issued 1/4 and 1/2 Rial banknotes as the purchasing power of Omani Rial is very high. Just like other gulf countries in the middle east Oman is also an oil-rich country and it is now a developed economy with a high standard of living.

The government of Oman has decided to diversify its income which is heavily linked to crude oil production to different other sectors like metallurgy, development of gas production, and tourism as oil reserves are depleting fast.

4. Jordanian Dinar: JOD

The Jordanian Dinar which has been the currency of Jordan since 1950 is ranked fourth in our list of the strongest currencies with a conversion rate of 1 JOD = 1.41 USD.

It was pegged to the US Dollar initially at a higher rate but for the last 2 decades, the country has managed successfully to maintain this peg.

There is no fundamental thesis available to justify its high valuation as Jordan is an emerging market and it is not so economically developed. Jordan lacks natural resources like oil, coal among others and it has significant external debt as well.

There is a gradual slowdown in the economic growth of Jordan since 2011 due to a substantial rise in population, external debt, and unemployment.

5. British Pound: GBP

British Pound Sterling ranks at fifth position among the world’s strongest currencies holding a conversion rate of 1 GBP = 1.38 USD. Many people have a perception that British Pound holds the highest monetary value but it is not.

GBP is the oldest currency in circulation as British Empire before world war I was spread across the length and breadth of the globe.

GBP is among the top traded currencies in the world. The GBP/USD pair is commonly known as “the cable,” in the Fx market by traders and it is the third most traded pair in the forex market after EUR and JPY.

Pound Sterling is not only the national currency of England but also Scotland, Wales, and Northern Ireland. GBP is used as a parallel currency in 3 British Crown Dependencies – Guernsey, Jersey, and the Isle of Man.

Few British colonies like Falkland Islands, Gibraltar, Saint Helena have their own respective currency which is valued as 1 per 1. However, the physical appearance of these paper currencies differs from the one issued by the Bank of England.

6. Cayman Islands Dollar – KYD

The Cayman Islands Dollar is the only Caribbean currency in the sixth position which features in our list of strong currencies. The primary reason for this is because of the fact that it is an autonomous British territory and considered to be one of the world’s best tax havens for corporates and Individuals.

Cayman Islands conversion rate is 1 KYD = 1.22 USD and it is among the top five largest offshore financial centers.

The country provides licenses to set up their companies to many banks, hedge funds, and insurance companies.

7. European Euro – EUR

The Euro ranks seventh in our list of the strongest currencies with a conversion rate of 1.19 against one dollar. EURO is the official currency for 19 European countries.

EURO is the second reserve currency after USD commanding a market share of 25% of all world savings. Approximately 25 countries have pegged their currencies to Euro at a fixed rate.

EUR/USD pair also referred to as “Fiber” is the most traded currency pair which accounts for more than 25% of daily volume. Also, EURO boasts to be the second most traded currency after the US Dollar.

8. Swiss Franc ($1.08)

The Swiss Franc ranks eighth in our top currencies list with a conversion rate of 1.08 against one dollar. CHF is one of the most stable currencies worldwide which is least affected by inflation.

Switzerland is one of the richest countries in the world and it maintains strict monetary policy and low debt levels. This is one of the primary reasons why it is a safe bet for investors while trading or storing currency.

9. US Dollar

US Dollar has been the “World Reserve Currency” since 1944 after the Breton woods agreement. US Dollar is the most traded currency in the forex market.

USD is always in high demand as it is accepted all over the world. USD is involved in more than 85% of daily forex trades. USA with a GDP of more than 22 Trillion is the economic engine of the world.

The USD currency in circulation is worth 1.69 trillion USD as of September 2018. Only 30% of currency is in circulation inside the United States.

There was a time in the US when notes with the face value of $1,000, $5,000, $10,000, and $100,000 were issued.

10. Bahamian Dollar: BSD

BSD happened to be the official currency of The Bahamas from the year 1966. BSD is pegged to USD at par.

Many of the businesses which cater to the tourism industry keep some extra US dollars with them for the convenience of American tourists.

11. Bermudian Dollar: BMD

BMD is the official currency of the British Overseas Territory of Bermuda. BMD is pegged to USD at a one-to-one ratio. The highest note in circulation is 100 BMD.

Trading of the Bermudian dollar outside Bermuda is not allowed. One can find both USD and BMD notes in Bermuda.

12. Panamanian Balboa: PAB

The Panamanian Balboa is the official currency of Panama along with the USD. PAB is also pegged to USD at par. The name Balboa is in honor of the Spanish explorer Vasco Núñez de Balboa.

When Panama gained independence in 1906 it replaced the Colombian Peso with The Balboa. An interesting fact about Panama is that country has never had an official central bank.

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