People often wonder which currency is the most stable in the world? Is it the US dollar or the British Pound? Well, by the time you finish reading this article, you will get your answer. In this article, not only will we answer the million-dollar question (most stable currency in the world), but we will also discuss and list down the most stable currencies in the world.
To compare the currency values, we will use the United States dollar as the fixed base currency. In this scenario, a currency will be considered vital if its value is greater than the USD and is more expensive.
Sixteen Most Strongest and Currency in the World
Below is a list of the sixteen most stable currencies in the world:
New Zealand Dollar
The New Zealand dollar (NZD) is the strongest currency on this list, as the currency’s value has constantly been increasing. The reasons behind the increasing strength of the NZD are high interest rates, stable political conditions, and rising GDP growth. Therefore, in exchange for 1 USD, you will receive 1.52 NZD.
Australian Dollar
The Australian Dollar (AUD) is Australia’s national currency used by many external Australian territories and islands. Even though the AUD is not the most expensive currency worldwide, it is a stable currency and is considered valuable. For example, 1 USD will get you about 1.45 AUD.
Singapore Dollar
Singapore’s official currency, the Singapore Dollar, also known as SGD, is also used in Brunei. In exchange for 1 USD, you will receive about 1.36 SGD. The SGD is also the 13th most traded currency globally and makes up 1.8 % of Forex’s daily trades.
Libyan Dinar
Libya’s national currency, the Libyan Dinar (LYD), is a diner that is divided into a thousand Dirham, unlike the 100 sub-measurements that most currencies follow. So, for example, in exchange for 1 USD, you will receive 1.41 LYD.
Canadian Dollar
Canada’s official currency, the Canadian Dollar (CAD), is most commonly used as a foreign reserve currency by central banks worldwide. The main reason for that is the political and legal stability in Canada. CAD is also popular in the Forex market, making up 5 % of the daily Forex trades. 1 USD will get you approximately 1.31 CAD.
United States Dollar
The United States Dollar is America’s official currency and is considered an official currency by other nations. The USD is the main reserve currency globally and is held by most commercial and central banks. The USD is the most commonly used currency worldwide and makes up approximately 88.3 % of the daily Forex trades.
These are the titles held by the USD:
- Currency of the wealthiest nation in the world
- 10th Strongest currency in the world
We have discussed the strength of various currencies in this list relative to USD, and 1 USD exactly equals 1 USD.
The Swiss Franc
The Swiss Franc (CHF) is Switzerland and Lichtenstein’s national currency, and in exchange for 1 USD, you will get around 0.98 CHF. Switzerland is one of the wealthiest and stable countries globally, and the CHF is considered a safe currency, especially when there is economic instability.
Euro
The official currency of the European Union, the Euro, is relatively new. The Euro is the currency of nineteen European nations, making it the most used ‘national currency’ globally. Some countries where the Euro is an official currency are:
- Spain
- France
- Germany
The Euro is also known as the 2nd reserve currency globally and is the 2nd most traded currency in the Forex market. The USD/EUR currency pairing is the most sold in the Forex market, is also called Fiber. In exchange for 1 USD, you can get 0.90 EUR (90 cents).
Cayman Islands Dollar
The 7th strongest currency in the world belongs to the Cayman Islands, known as the Cayman Islands Dollar (KYD). The Cayman Islands are located in the Caribbean and are an autonomous British territory. The islands are also a tax haven for corporations and wealthy individuals.
In exchange for 1 USD, you will get 0.83 KYD, making it by far the strongest currency in the Caribbean.
Gibraltar Pound
The official currency of Gibraltar, the Gibraltar Pound (GIP), is exchangeable with the Pound Sterling at face value. Therefore, in Gibraltar, you use both the GBP and GIP, and in exchange for 1 USD, you will receive 0.81 GIP.
British Pound
The British Pound, also known as Pound Sterling, is the 5th most valuable currency worldwide, despite not being among the strongest currencies. The Pound Sterling is the oldest currency in the world and is widely used. Currently, the money is the 4th most traded, making up 12.8 % of the daily trades on the Forex Market.
In exchange for 1 USD, you will receive 0.75 GBP. The currency pairing (USD/EUR) is called Cable and is the 3rd most traded pairing in the Forex market.
Jordan Dinar
The currency of Jordan is called Jordan Dinar (JOD), which currently sits at the No.4 spot on the list of the strongest currencies globally. The currency was adopted as the official currency of Jordan in 1950, and it replaced the Palestinian Pound. Therefore, in exchange for 1 USD, you will receive 0.71 JOD.
Omani Rial
In another Arabic country, the official currency of Oman is the Omani Rial (OMR). Unlike most money, the Omani Rial is split into a thousand minor divisions called ‘Baisa.’ The value of the Omani Rial rose due to Oman’s oil exports. Another reason why the value of the currency swelled is that it is pegged to the USD.
In exchange for 1 USD, you will receive 0.38 OMD, nearly double the value of the British Pound.
Bahrain Dinar
Bahrain is another country located in the Middle East, and Bahrain Dinar (BHD) is the 2nd strongest currency globally. Like other Arab currencies, the BHD is divided into a thousand units called ‘Fils.’ The BHD is pegged against the USD and only operates in Bahrain. So in exchange for 1 USD, you will get 0.38 BHD.
Kuwaiti Dinar
The Kuwaiti Dinar is officially the strongest currency worldwide and was introduced in 1960. Initially, the KWD was valued at one British Pound, and gradually, the value of the currency rose with time. Kuwait is a small nation; it is sandwiched between Iraq and Saudi Arabia and the most significant global oil exporter.
If you exchange 1 USD, you will only receive 0.30 KWD, making the Kuwaiti currency by far the strongest in the world.
The Most Stable and Safest Currency in the World?
Now that we have discussed the list of the strongest currencies, we can answer this question. As mentioned earlier, due to stable political and economic conditions and an inflation rate of just 0.86 % in Switzerland, the consensus is that the Swiss Franc (CHF) is the safest currency.
The currency is so safe that its value will not depreciate during political turmoil or an economic crisis.
Eight Most Traded Currencies in the World
United States Dollar
The United States Dollars (USD) is the most widely traded currency globally and is also held by commercial and central banks worldwide. The American Dollar is a primary reserve currency and is used for international transactions as well. Many commodities like copper, gold, oil, and precious metals are priced in USD.
Euro (1 EUR: 1.17 USD)
The Euro is the official currency of the EU (European Union) and is the second most traded currency in the world. 19/27 European Union nations use the money. The Euro is also the second-largest reserve currency globally.
Japanese Yen (1 JPY: 0.0095 USD)
Japan’s currency is the most widely traded in the market of Asia. Oil is a significant factor in determining the value of the Yen. Japan is a leading importer of oil, so a rise in oil prices influences the country’s economy.
Pound Sterling (1 GBP: 1.29 USD)
The Pound Sterling, also known as the British Pound, is the currency of the UK (United Kingdom). In recent years, the changing relationship of the UK with other European countries has affected the value of the Pound Sterling.
Australian Dollar (1 AUD: 0.71 USD)
In 2020, the Australian Dollar was the 5th most traded currency in the world. Australia is the leading exporter of mined commodities, copper, gold, and leading oil importer. Therefore, a change in the prices of commodities and minerals can impact the value of the Australian currency.
Canadian Dollar (1 CAD: 0.76 USD)
Like Australia, Canada is also rich in natural resources and is a leading exporter of several commodities. However, the main trading partner of Canada is its neighbor, the United States, which accounts for 75 % of Canada’s exports and 50 % of the imports. As a result, the Canadian Dollar is impacted by changes in the economy of America and the currency.
Swiss Franc (1 CHF: 1.09 USD)
Switzerland is considered a hub for banking and financial services. The country also has low debt levels and good monetary policies, which has made its currency a ‘Safe Haven.’
Chinese Renminbi (1 CNY: 0.15 USD)
The Chinese Renminbi, also called the Yen, is the 8th most traded currency globally. China mainly exports manufactured goods, and the terms of trade influence the value of the country’s currency. The major trading partners of China are Japan, the United States, and Europe.
The Top Forex Currency Pairs
| # | CURRENCY PAIRING | VOLUME % |
| 1 | EUR/USD | 27.95% |
| 2 | USD/JPY | 13.34% |
| 3 | GBP/USD | 11.27% |
| 4 | AUD/USD | 6.37% |
| 5 | USD/CAD | 5.22% |
| 6 | USD/CHF | 4.63% |
| 7 | NZD/USD | 4.08% |
| 8 | EUR/JPY | 3.93% |
| 9 | GBP/JPY | 3.57% |
| 10 | EUR/GBP | 2.78% |
| 11 | AUD/JPY | 2.73% |
| 12 | EUR/AUD | 1.8% |
| 13 | EUR/CHF | 1.73% |
| 14 | AUD/NZD | 0.96% |
| 15 | NZD/JPY | 0.93% |
| 16 | GBP/AUD | 0.89% |
| 17 | GBP/CAD | 0.81% |
| 18 | EUR/NZD | 0.78% |
| 19 | AUD/CAD | 0.76% |
| 20 | GBP/CHF | 0.73% |
| 21 | AUD/CHF | 0.7% |
| 22 | EUR/CAD | 0.7% |
| 23 | CAD/JPY | 0.67% |
| 24 | GBP/NZD | 0.64% |
| 25 | CAD/CHF | 0.58% |
| 26 | CHF/JPY | 0.57% |
| 27 | NZD/CAD | 0.48% |
| 28 | NZD/CHF | 0.38% |
What is Forex Trading?
Forex trading is when a trader buys a currency and sells a different one, and the exchange range fluctuates according to the demand and supply. The trade for currencies takes place in the foreign exchange market that is open from Monday to Friday.
The Foreign exchange market is open 24 hours a day. All currencies are traded over the counter (OTC), which means there are no physical exchanges, and a worldwide network of financial institutions and banks oversee the operations. As a result, the vast majority of trading in the market is between institutional traders.
Conclusion
In this article, we have thoroughly discussed the strongest currencies and the most traded currencies globally. We have also shed some light on the most common currency pairings globally and answered the most critical question: what is the most stable currency in the world?
If you are trying to trade in the Forex market, you should gain as much information as possible about currencies. The good news, we have you covered, and all the information that we have discussed is accurate and up to date.
Carefully read through all the details, weigh the pros and cons, and make your own decision.