Buzz Feedz: The U.S. dollar is a dominant currency in the world; it is by far the most traded currency globally and frequently used as a benchmark for comparing currencies.
Although Kuwait's dinar holds the title of being the world's strongest currency, the dollar is still among the top 180 traditional fiat currencies that are accepted as legal cash globally. Money that is not backed by the value of a physical good like gold or silver is referred to as fiat currency.
The least valuable currencies in the world, which trade for small fractions of a dollar, are at the other extreme of the spectrum. To earn just $1, you may need tens of thousands of foreign currency units.
1. IRR, Iranian Rial
The Iranian rial is the world's weakest currency, only worth 0.000024 of a dollar (or, to put it another way, 42,300 rials).
Economic sanctions, particularly those the United States reinstated in 2018 and others the European Union has repeatedly imposed, have put pressure on Iran's currency. Iran's weak currency and economy are also a result of political upheaval and yearly inflation rates that have been exceeding 40%.
2. Vietnam Dong (VND)
A dollar is equivalent to 23,485 Vietnamese dong, making the Vietnamese dong the second-weakest currency in the world.
A poor real estate market, restrictions on foreign investment, and a recent downturn in export activity have all hurt Vietnam's currency.
Despite any flaws, the World Bank claims that Vietnam is evolving "from one of the poorest countries in the world into a lower middle-income country. Vietnam is currently one of the region's most vibrant emerging nations.
3. Lao Kip (LAK)
The Laotian kip, often known as the Lao kip, is the third-weakest currency in the world, with 1 kip equaling 0.000057 dollars (17,692 Lao kip).
Sluggish economic expansion and crippling foreign debt obligations have affected Laos, which is located just west of Vietnam, and its kip currency. Declines in the kip have made inflation worse, including higher prices for oil and other global goods, which is in turn contributing to the currency's further depreciation.
The Council on Foreign Relations emphasises that recent government measures to curb inflation, debt, and the depreciating currency of the nation have been poorly thought out and ineffective.
4. The nation of Sierra Leone (SLL)
The Sierra Leonean leone is the fourth-weakest currency in the world, buying 0.00000057 of a dollar, or 17,665 leones.
A combination of sluggish economic growth, significant debt obligations, and high inflation—which will surpass 43% in April 2023—have devalued this West African country's currency. Other issues hurting the country's currency, according to observers, include rampant public corruption, the lasting impacts of a past civil war and the 2010 Ebola outbreak.
According to the World Bank, concurrent global and domestic shocks have hampered Sierra Leone's economic development.
5. LBP, the Lebanese Pound
The Lebanese pound ranks fifth among the world's worst currencies, buying 0.000067 of a dollar (15,012 LBP for $1).
The Lebanese pound had a record low value versus the US dollar in March 2023. Against a backdrop of a severely depressed economy, historically high unemployment, a continuing banking crisis, political anarchy, and skyrocketing inflation, the currency has been performing appallingly. In 2022, prices are expected to increase by 171%.
6. IDR, Indonesian Rupiah
The Indonesian rupiah is the sixth-weakest currency in the world, buying 0.000067 of a dollar (or 14,985 Indonesian rupiah for $1).
The rupiah's poor ranking demonstrates that size isn't necessarily a virtue. The fact that Indonesia is the fourth most populous nation in the world cannot protect it from a devalued currency. Even while the rupiah has shown some strength in 2023 when compared to its Asian rivals, devaluation has previously shaken the currency.
The International Monetary Fund issued a warning in March 2023 that the rupiah would come under increased pressure from a global economic downturn.
7. Uzbekistani Som
With 1 som equaling 11,420 som (or $1), the Uzbekistani som is the seventh-weakest currency in the world.
Uzbekistan, a country in Central Asia and a former Soviet republic, has been implementing economic reforms since 2017. The som is still a fragile currency, constrained by sluggish economic expansion, high inflation, high unemployment, widespread corruption, and persistent poverty.
Although the [Uzbekistani] economy has shown resilience to the effects of the conflict in Ukraine and the sanctions against Russia, there is still a great deal of uncertainty on how these risks will develop, according to the Fitch Ratings agency in March 2023.
8. The GNF (Guinean Franc)
The Guinean franc ranks eighth among the world's weakest currencies, buying 0.000116 of a dollar (or 8,650 Guinean francs for $1).
Guinea, a country in sub-Saharan Africa and a former French colony, is rich in natural resources like gold and diamonds, but the Guinean franc is suffering due to rampant inflation in the country. Guinea's deflated economy and currency are a result of unrest against the country's military leadership and an influx of refugees from Sierra Leone and Liberia, two nearby countries.
The Economist Intelligence Unit predicts that in 2023, Guinea's economic activity will continue to be below potential (albeit still solid by regional standards).
9. The Paraguayan Guarani
The Paraguayan guarani is the ninth-weakest currency in the world, with 1 guarani equivalent to 0.000138 of a dollar, or 7,241 guaranies.
Despite being the world leader in the production of hydroelectric power, Paraguay's dominance in this field hasn't translated into economic dominance. The currency and overall economy of Paraguay, a landlocked nation in South America, have been devalued due to high inflation, which is expected to reach 10% in 2022, drug smuggling, and money laundering.
The International Monetary Fund stated in April 2023 that "the medium-term economic outlook [in Paraguay] remains favourable, but there are risks from a deteriorating global outlook and extreme weather events."
10. The Ugandan Shilling
A dollar is equivalent to 3,741 Ugandan shillings, placing the Ugandan shilling at No. 10 on the list of the world's 10 weakest currencies.
Despite being an oil, gold, and coffee-rich nation, Uganda's economy and currency have historically had erratic growth, significant debt, and political upheaval. An influx of refugees from the adjacent Sudan has made things more difficult.
According to the CIA, "Uganda faces many issues that could affect future stability, including explosive population growth, infrastructure and power shortages, corruption, underdeveloped democratic institutions, and human rights deficits."
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