The strength of any currency is determined by number of factors including its demand and supply in the foreign exchange market, interest rate, economic growth and balance of trade. High exports of any country have been a major factor for its strong currency. In addition, the strength of a currency compared to another currency determines its value. At present almost 180 currencies are circulating in the world, some countries have the strongest currencies compared to the US Dollar.
Most people passively believe that the US Dollar or Pound Sterling might be the strongest currency in the world. Yes, they are, but the Kuwaiti Dinar and currencies of other middle eastern countries top the list of strongest currencies of the world. The world’s top strong currencies are listed below: –
1. Kuwaiti Dinar
Kuwait is one of the richest countries in the world due to its large oil reserves. Being a huge economy, it possesses the strongest currency in the world i.e. Kuwaiti Dinar. The value of one Kuwaiti Dinar is equal to 3.26 US Dollars.
2. Bahraini Dinar
Bahrain is a small island in the Persian Gulf with population of 01 million. Like Kuwait, the major revenue source of Bahrain is the export of natural gas and oil. Bahrain also has a major pearl and gems industry but mining has been discontinued since 1930. The value of one Bahraini Dinar is equal to 2.65 US dollars.
3. Omani Rial
Oman is another oil-rich gulf state which is located at the confluence of the Arabian sea and the Gulf of Aden. Oman has also one of the strongest currencies in the world compared to US Dollar. The value of one Omani Rial is equal to 2.60 US dollars.
4. Jordanian Dinar
Jordan is located at the bank of the dead sea; this west Asian country also has vast resources of natural gas. Jordan has no vast natural resources and its economy is not so strong. However, Jordan has fourth-strongest currency in the world. One Jordanian Dinar is equal to 1.41 US dollars.
5. Pound Sterling
Pound Sterling, the currency of Great Britain considered the strongest currencies in the world. But, it is not the fact, Pound Stirling comes next to many gulf state currencies. Also, the United Kingdom’s exit from European Union has also put the UK Pound in a struggling condition. However, it value is still high compared to the many currencies of the rest of the world and one Pound Stirling is equal to 1.22 US dollars.
6. Gibraltar Pound
Gibraltar is situated at the border of Spain where the strait of Gibraltar connects the Atlantic Ocean to the Mediterranean sea. It is the British overseas territory, hence its currency, Gibraltar Pound has the same value to the Pound Sterling. Gibraltar Pound is equal to 1.22 US Dollars.
7. Cayman Island Dollar
Cayman Island is also the oversea territory of the United Kingdom. Hence, its currency has almost similar value to the Gibraltar Pound and Pound Sterling. One Cayman Island Pound is equal to 1.20 US dollars.
Euro is introduced on 1st January 1999 and 19 out of 28 European Union countries have replaced their national currencies with the Euro. It is considered the second world reserve currency after the US Dollar. One euro is equal to 1.05 United State dollars.
9. Swiss Frank
Swiss Franc is the official currency of Switzerland and Liechtenstein. One Swiss Franc is equal to 1.03 US dollars. The strength of Swiss Franc is determined by the strong economy of Switzerland which is dependent upon its highly skilled workforce, metals, pharmaceuticals and electronics production.
10. United States Dollar
Every layman considers the dollar as strongest currency in the world. But it comes at number ten in the list of strongest currencies in the world. The dollar is the reserve currency of the world means being the strong currency it is widely used in international trade and foreign payments. All countries maintain sufficient reserves of US Dollars to maintain the exchange rate.