On a daily basis a currency’s value will change against another. When looking at their relative strength, it’s common to compare them against one of the major reserve currencies like USD, EUR or GBP.
Using data from Nov 2022 , we’ve compiled a list of the world’s ten most valuable currencies and explained why they have such a high worth.
🇧🇭 Bahrani Dinar (BHD)
£1 = 0.45
Over the years the Bahraini’s have built a strong economy with solid foundations. They’ve also enforced domestic conformity to a strong economic growth programme. This has in turn seen mass investment inward and outward and propelled the currencies value upwards.
It is often in the top three of the world’s most valuable currencies.
🇨🇦 Canadian Dollar (CAD)
£1 = 1.6
Canada has vast energy reserves that make it a huge exporter of commodities like oil.
The country also benefits from its immense economic ties with the US, Britain and the EU, all countries with powerful currencies.
The country is a member of the G7 and is regularly towards the upper end of many lists when it comes to finance and economics. This all helps to keep the Canadian Dollar high in value.
🇰🇾 Cayman Islands Dollar (KYD)
When most people think of the Cayman Islands, they think of it as an off-shore territory. Most people don’t realise that despite not technically being an independent country, they still have their own currency.
The Cayman Island Dollar has a high value for many reasons. Firstly it benefits from exceptionally close ties with the UK and the USA. The territory is very politically stable and is home to a multitude of international businesses. The KYD is also pegged to the USD at a rate set by the Cayman Islands Monetary Authority.
🇪🇺 Euro (EUR)
The Euro is also the world’s second largest reserve currency with 20%+ of foreign exchange reserves being held in it.
As a rule, when new currencies are introduced, they tend to suffer. This was not the case though with the Euro. It benefitted massively from being in a sense the successor to the Deutsche Mark, a one-time super currency. This enabled the Euro to carry all the strength & value of the DM plus all the additional weight of the other currencies it replaced.
🇯🇴 Jordanian Dinar (JOD)
Surrounded by neighbours who are regularly in conflict, the Kingdom of Jordan benefits from peace and stability. It also benefits from natural resources that fuel the economy.
The Jordanian Dinar is on a fixed exchange rate with the USD that keeps the value high and is tightly controlled by the Jordanian Central Bank based in the capital Amman.
🇰🇼 Kuwaiti Dinar (KWD)
The Kuwaiti Dinar pretty much always tops the list as the world’s most valuable currency.
Kuwait firstly benefits from huge oil reserves which make it one of the world’s richest countries. Secondly, unlike other countries in a similar position, Kuwait is known for domestic political and economic stability.
The country has been a safe haven for many years and benefits from strong military ties with NATO and the USA. It is unambiguous in its support for the US who in turn have guaranteed Kuwaiti independence giving an extra layer of confidence to investors in this market.
🇴🇲 Omani Rial (OMR)
Like the other Gulf states mentioned above, Oman benefits from vast natural resources, especially oil. Unlike others though it has a system that is (in comparison) quite open-minded and tolerant. The country is very stable and has good relations with virtually all other countries.
The Omani Rial’s value is therefore high because its economy is strong and investors tend to enjoy and relish doing business there.
The country also boasts low inflation, a strong banking system and low levels of debt, all of which go into boosting the value of OMR.
🇬🇧 Pound Sterling (GBP)
For a long time, Sterling was the currency of international trade, only being replaced by the USD in the 1940/50s. Sterling’s strength comes from its role as being a highly traded and in many ways safe haven currency.
The City of London helps boost the currency’s value, as does the UK’s centuries old institutions which have shown the right mix of continuity and change to keep currency markets happy over the last few decades.
🇨🇭 Swiss Franc (CHF)
Given Switzerland’s position as the world’s bank, there’s no wonder their currency, the Swiss Franc, is so valuable.
The Swiss Franc has long been seen as one of the world’s strongest, safest and most stable currencies, in a country which as a whole shares these features.
Unless it gets replaced as the banking centre of the world (which is unlikely anytime soon) the currency will remain as one of the world’s most valuable.
🇺🇸 US Dollar (USD)
There’s no surprise that the USD makes this list. The Dollar gets its value firstly solely due to the fact that it is the currency of the world’s largest economy.
Secondly, the Dollar is not just the currency of the United States, it is also the currency of global trade, oil for example is sold in USD.
Finally, it is also overwhelmingly the world’s most favoured reserve currency. Over 80% of world FX reserves are held in the US Dollars.
For the foreseeable future, the Dollar will remain one of the world’s most traded and therefore most valuable currencies.