Have you ever wondered what are the strongest currencies in the world? Around 180 currencies are recognized as national currency by the United Nations, but which is the strongest?
When you think of the strongest currency in the world, you will probably say it is the US Dollar or the Euro. Surprisingly, none of the currencies mentioned is the strongest today. This is because the strongest don't always come from the world's wealthiest countries.
You heard it right - think again if you believe the USD is the world's strongest currency!
The US Dollar may not be the strongest in the world, but it is the most traded and influential. That is why we used the United States dollar as the fixed base currency to compare the value of the other currencies. In this case, the strongest currency is the one that gives you more compared to the US dollar.
We measure currency strength by the number of goods and services you can purchase and the amount of foreign money received in exchange for that one national currency unit. Simply put, the strength of the currency is calculated by its value or worth. However, keep in mind that a strong currency does not always mean a strong economy as well.
Want to learn more? Read on as we have listed the top 5 strongest currencies in the world as of October 2021, whose exchange rates are much higher than the US Dollar (and Canadian Dollar, for that matter).
1 GBP = 1.37 USD
1 GBP = 1.70 CAD
Did you know that the Pound Sterling was once worth over five US Dollars in the early 1900s?
The national currency of Great Britain and many of its territorial claims (Jersey, Guernsey, the Isle of Man, South Georgia and the South Sandwich Islands, the British Antarctic Territory, and Tristan da Cunha) is the pound sterling or GBP. Because of Britain's steady-growth economy, the Pound is valued higher than the US Dollar.
Fun fact: Banks always love a low-inflation economy like Great Britain!
In the foreign exchange market, GBP is the fourth most traded currency. Introduced in 1489 in the United Kingdom, the currency is also the world's oldest and most widely used currency. London is also renowned as the world's financial center. Given the country's strong trade efforts, it's obvious why the British Pound made it to the top 5 strongest currencies in the world.
1 JOD = 1.41 USD
1 JOD = 1.75 CAD
The Jordanian Dinar is an exception here. Jordan's economy has struggled to thrive, and the country is heavily in debt. If you're wondering why is the JOD one of the strongest currencies in the world as of October 2021, it is because the Arab country pegged its currency to the US Dollar over 20 years ago.
Pegging means controlling a country's currency rate by fixing or tying it to another country's currency. Despite Jordan's weak economy because of not being overly dependent on oil exports like its neighbours, this has given the Jordanian Dinar some strength. Regardless of its ranking, the Jordanian Dinar is only used in Jordan and nowhere else.
1 OMR = 2.60 USD
1 OMR = 3.22 CAD
Thanks to the country's strong petroleum production and easy access to natural resources, Oman's currency, the Omani Rial (OMR), is one of the strongest currencies in the world. Like the Jordanian Dinar, the Omani Rial is pegged to the US dollar.
Fun fact: Oman used INR as its national currency until 1940, which is why INR to OMR is the most popular Rial exchange rate.
1 BHD = 2.65 USD
1 BHD = 3.29 CAD
Situated on the Persian Gulf, Bahrain's currency, the Bahraini Dinar, is the second strongest currency in the world. Like Oman, Bahrain is a major crude oil exporter. Since 1986, the country's currency has been fixed to the US dollar at 2.65.
Fun fact: The largest immigrant population in Bahrain is Indians, which explains why the INR to BHD exchange rate is so popular.
1 KWD = 3.31 USD
1 KWD = 4.11 CAD
The Kuwaiti Dinar holds the title of the world's strongest currency. Kuwait, also located on the Persian Gulf, generates nearly 80% of its total revenue from the oil business. Many of these sales are made with the United States, providing Kuwait and the other top three currencies on this list with large US dollar reserves to support their currencies.
The KWD has been the strongest currency in the world due to Kuwait's currency being in huge demand for oil for a long time. It's also worth mentioning that you won't have to pay any taxes if you work in Kuwait!
We want to get the most value for our dollar when travelling abroad, even if it's only a few cents more. If looking for business prospects, go for the countries with the strongest currencies. After all, in countries with the strongest currencies, your money will go a lot further.
Remember that countries' high inflation rates, political strife, and poor economic conditions can weaken currencies. Though, it is not always a bad thing! Having a weak currency can also benefit some countries.
Also, do not worry about high currency conversion fees or low exchange rates. RemitBee is here to help you send or exchange money quickly and easily. Get your free account today!