The Kuwaiti Dinar - The Strongest Currency in The World
What is the strongest currency in the world?
The Kuwaiti dinar (KWD)
At the top spot is the Kuwaiti dinar. Kuwait is the 5th richest country in the world per capita thanks to its oil revenues. Its wealth, along with its political stability, keeps its currency at the strongest position globally.
The Kuwaiti dinar is the official currency of the State of Kuwait.
The Kuwaiti dinar is divided into 1000 ‘fils’.
Kuwait lies to the north-west of the Persian Gulf. It shares a border with Saudi Arabia to the south and Iraq to the north.
The land area of Kuwait is 17,820 square kilometres, which is 6,880 square miles.
The population of Kuwait is 4.2 million, with about 1 million being native Kuwaitis, while the rest of the population are expatriates from other (mainly Asian) countries. Men outnumber women nearly 2 to 1 in the 30-65 age group.
Kuwait is the fifth richest country in the world per capita. It has an projected GDP in 2022 of 138 billion USD.
It is estimated that Kuwait has 10% of the world’s crude oil reserves, at 104 million barrels.
The Constitution of Kuwait ensures that all natural resources are government property.
The oil industry provides 80% of government revenue and 95% of all export earnings. Kuwait is a tax-free country. It has one of the lowest unemployment rates in the world.
Kuwait has a diverse population and is considered less restrictive than its neighbours. Most Kuwaitis are Sunni Muslims but it is open to other religions e.g. it is the only Middle Eastern muslim country which offers citizenship to Christians.
The history of the Kuwaiti dinar
The British-run East India Company established a presence in what is now Kuwait in the 1700s. The area had long held a strategic position for shipping connections between ports in India, Africa and along the Red Sea.
Kuwait then became a British Portectorate in 1899 when it was threatened by the Ottoman Empire.
The Gulf rupee was the official currency used in the British Protectorates in the Arabian peninsula after 1959, when it was issued by the Indian government for use outside of India. It was used particularly in the Persian Gulf region.
Following WW2 and a global increase in oil consumption, the Kuwaiti economy boomed, and oil now accounts for one third of its GDP.
In 1960 the Kuwaiti currency board was created and the Kuwaiti dinar was put forward as a new currency.
When Kuwait became independent from Britain in 1961, the Kuwaiti dinar replaced the Gulf rupee. It was initially on a par with the British pound.
In 1969, the Central Bank of Kuwait replaced the Kuwaiti Currency Board.
In 1990 Iraq invaded Kuwait and the Kuwaiti dinar was replaced with the Iraqi dinar. On liberation, the Kuwaiti dinar was restored as the official currency and a new series of banknotes was made. This was due to the fact that millions of Kuwaiti dinar were stolen by the Iraqi forces and so the pre-war issue of Kuwaiti dinar was demonetised.
in 1975, the Kuwait Currency Board started pegging the Kuwaiti dinar to a basket of currencies.
In 2003, the Kuwaiti dinar was pegged to the US dollar at 0.29963 dinar to the dollar (around 3.33 dollar to the dinar).
In 2007 the Central Bank of Kuwait began again pegging the Kuwaiti dinar to a weighted basket of currencies. Although it is not know which currencies these are, or the weighting of each, it is thought that the US Dollar features heavily.
What is a Kuwaiti dinar worth?
The Kuwaiti dinar is the most valuable currency in the world, whereby 1 dinar would buy you 3.29 US dollars (at the time of our latest update in April 2023).
What is the code for the Kuwaiti dinar?
The code for the Kuwaiti dinar is KWD.
Where does the word 'dinar' come from?
The name dinar is given to many currencies worldwide and comes from the Roman word ‘denarius’ , which was a small silver coin issued during the Roman Empire.
Is the Kuwaiti dinar traded on the foreign exchange market?
The Kuwaiti dinar is an extremely stable currency, and as such its value only fluctuates within a relatively small range. Because of this, it is not generally traded by foreign exchange traders and it is not a popular speculative trading instrument in the foreign exchange market.
Is the Kuwaiti dinar pegged to other currencies?
Since 2007, the Central Bank of Kuwait has pegged the Kuwaiti dinar to a weighted basket of currencies. Although the specific currencies are not disclosed, or the weighting of each, it is thought that the US Dollar features heavily.
Why is the Kuwaiti dinar so strong?
The demand for the Kuwaiti dinar is high, making the currency very valuable. Kuwait is considered a politically stable country, with high oil revenues. As the global demand for oil continues to increase, so the Kuwaiti dinar will likely remain very strong.
Is the Kuwaiti dinar worth more than the US Dollar?
Yes, along with 7 other currencies, the Kuwaiti dinar is worth more than the US dollar. 1 Kuwaiti dinar would buy you 3.22 US dollar.
Although the US dollar remains the world’s reserve currency and is the most common currency used for international transactions, the Kuwaiti dinar is worth more than the US dollar.
This is the strongest currency in the world, what about the weakest currency in the world?
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