An Arab country is the first… Learn about the strongest currencies in 2024

April 1, 2024

A new report by the Techopedia platform, a platform concerned with technology issues and keeping pace with the development of various other fields, revealed the 15 strongest currencies in the world for the year 2024.

The report is based on currency exchange rates against the dollar, and it sheds light on the dynamics of currency strength and the factors affecting it. Likewise, the report confirms The importance of various economic indicators and geopolitical considerations in determining currency values.

Currency strength

Currency strength, which is an important aspect of the global economy, refers to the relative purchasing power of the currency compared to other currencies, and the US dollar is chosen as a reference standard due to its great dominance as the most prominent currency in the world, so it is outside of comparison.

It is worth noting that the US dollar participated in 88% of all foreign exchange transactions between 2019 and 2022, according to a central survey conducted every 3 years by the Bank for International Settlements.

Currency pricing

The foreign exchange pricing mechanism covers a diverse landscape. While most global currencies operate under a floating exchange rate system, where their foreign exchange rates are determined by market forces of supply and demand, some currencies are tied to a reference currency. However, a fixed exchange rate system ensures stability.

Basics of currency strength

There are many factors that support currency strength, including inflation rates, political stability, and economic outlook. Among these determinants, three main determinants stand out: terms of trade, interest rate differentials, and capital controls.

In an interview with the Techopedia platform, Dr. Sarah Johnson, an economist, said that “terms of trade play a pivotal role in influencing the rise or fall in the value of the currency,” adding: “Similarly, interest rate differentials and capital controls have a significant impact on the flow of capital.” Thus, it affects the exchange rate of foreign currencies.”

In turn, John Smith, a veteran economic analyst for the platform, said: “The imposition of strict capital controls by central banks, especially in Middle Eastern countries such as Kuwait, has contributed significantly to the rise of their currencies on the global scene.”

The strongest currencies in the world

As of March 2024, the 3 strongest currencies in the world were the Kuwaiti dinar, the Bahraini dinar, and the Omani riyal, and these currencies confirm the profound impact of geopolitical factors on currency valuations.

1- Kuwaiti Dinar (KWD)

Topping the list is the Kuwaiti dinar, which has been considered the most valuable currency against the dollar. Linked to an undeclared basket of several global currencies, one Kuwaiti dinar is equal to $3.25.

2- Bahraini Dinar (BHD)

Next comes the Bahraini dinar, which is linked to the dollar, with the value of one dinar being $2.65.

3- Omani Riyal (OMR)

The Omani riyal occupies third place on the list, and one Omani riyal is equivalent to 2.6 dollars.

4- British Pound (GBP)

The pound sterling stands out as the fourth strongest currency in the world, with an exchange rate of $1.26 per pound sterling.

5- Swiss Franc (CHF)

The Swiss franc is known for its safe-haven currency status, and holds its place as the fifth most valuable currency. With an exchange rate of one Swiss franc equivalent to $1.10.

6- Euro (EUR)

The euro holds a strong position as the sixth strongest currency in the world, with an exchange rate of $1.08.

7- Brunei Dollar (BND)

The Brunei dollar ranks seventh, which reflects the stability and economic prosperity enjoyed by Brunei. So, the value of one Brunei dollar is 0.74 US dollars.

8- Singapore Dollar (SGD)

Singapore’s economic vitality is reflected in the strength of its currency, the Singapore dollar, which ranks eighth on the list, with the price of one Singapore dollar remaining at $0.74.

9- Canadian Dollar (CAD)

Canada’s status as a crude oil exporting country contributes to the strength of its currency, the Canadian dollar, as it ranked ninth with a value of $0.735.

10- Australian Dollar (AUD)

Australia’s position as a major exporter of basic commodities is confirmed by the strength of its currency, the Australian dollar, which ranks tenth on the list, with a value of $0.65.

11- New Zealand Dollar (NZD)

The New Zealand dollar ranks 11th with a value of $0.599.

12- Bulgarian Lev (BGN)

The Bulgarian lev is ranked 12th, demonstrating Bulgaria’s transition to a market-based economy, and the value of the lev is $0.553.

13- Qatari Riyal (QAR)

Qatar’s rapid economic growth is reflected in the strength of its currency, the Qatari riyal, which ranks 13th in the world, with a value of $0.275. (Al Jazeera Net)

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