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List of the most stable currencies in the world in 2023: exchange rate volatility, highest monetary values, inflation rates, and what country’s money to invest in.
Purchasing foreign currency is the simplest and most straightforward way to preserve your savings. If you buy foreign currency, you can protect yourself against inflation without worrying about the domestic economic situation and currency volatility.
By purchasing different foreign currencies, you can also avail of fluctuations in exchange rates and make money on the exchange rate differential.
The US dollar is the most trivial one to invest in. You can open a bank account in this currency almost anywhere abroad. However, it’s been dominating the market for too long, and there is a high chance that it will no longer be the most stable option in the near future.
Let’s look at other currencies with solid potential and worth investing in.
Country: Kuwait
Currency rate: 1 KWD = 3.24 USD
Kuwaiti dinar (KWD) is the official currency of Kuwait. It is a rich country located in the Middle East and washed by the Persian Gulf. The first dinars were issued in 1961 to be used instead of the Gulf rupee.
The country’s economic affluence is greatly dependent on its natural sources, mainly oil export. Nevertheless, the Kuwaiti government is planning to diversify the local economy and attract more foreign investors. For example, providing alluring opportunities in the financial sector and manufacturing.
Kuwait has the world’s oldest sovereign wealth fund – the Kuwait Investment Authority (KIA). It manages the state’s General Reserve Fund (GRF), the Future Generations Fund (FGF), and more than $800 billion in assets, ensuring the long-term welfare of Kuwait.
The Kuwaiti dinar is pegged not to only one currency but to a whole range of currencies (basket peg system). Those currencies are not disclosed but are believed to be largely centered on the US dollar.
From the year 2015 to 2022, one Kuwaiti dinar was equal to around 3.2 and 3.4 US dollars. As we can see, its value has remained stable since then, and in 2023, 1 KWD cost firmly remains at 3.24-3.29 US dollars. This makes Kuwait money a strong, low-volatility currency worth investing in.
As of 2023, the Kuwaiti dinar is the most highly valued currency in the world compared to other currencies. The demand for KWD is currently very high.
Country: Bahrain
Currency rate: 1 BHD = 2.65 USD
Bahraini dinar (BHD) is the official legal tender in Bahrain – another rich country in the Persian Gulf and Middle East. Its wealth mainly derives from its natural sources, such as oil and gas.
The currency was first introduced in 1965, and in 1980, it was pegged to the US dollar at a fixed rate of 1 USD = 0.376 BHD.
According to Forbes, BHD is the second strongest currency globally. Its value has not changed much during the last 20 years, making it a low-volatility currency. Since 2003 it has cost around 2.60, its low being 2.56 and its highest – 2.71.
The state’s inflation rates also proved to be stable and low. In certain periods in 2020 and 2021, Bahrain’s economy even experienced deflation while prices dropped. In 2020, the lowest deflation rate was at -2.33%, and in 2021, at -0.61%.
In June 2023, the inflation rate was equal to only 0.4%. According to research experts’ forecasts, inflation in Bahrain will be decreasing in the next several years.
Country: Oman
Currency rate: 1 OMR = 2.60 USD
Oman is among the wealthiest Middle Eastern countries, featuring a high-income, oil-based economy. Its official currency, Omani rial, is considered to be the third strongest in the world.
The purchasing power of this currency is so high that the government has to issue 1/2 and 1/4 rial banknotes.
Omani rial value proved to be stable over the years – since 2018, it remained in the range from 2.58 USD to 2.64 USD for 1 Omani rial.
The Omani rial is tied to the US dollar. The fixed rate of 1 Omani rial = US$2.6008 has stayed unchanged since 1986.
Oman has a free trade agreement with the United States. In 2021, total trade value with the US accounted for over $3.2 billion.
The inflation rates in Oman are the lowest among the GCC countries. According to the International Monetary Fund forecast, the average inflation rate in the country will account for 1.9% in 2023.
The Gulf state has set a plan to diversify its economy, which is significantly dependent on oil exports nowadays.
In 2020, the Foreign Capital Investment Law came into force to strengthen the Sultanate's credibility as a state attractive to foreign investments. Foreign investors in Oman are eligible to own 100% of their business in almost any sector, with a few exceptions.
Country: Jordan
Currency rate: 1 JOD = 1.41 USD
Jordanian dinar (JOD) is the official currency of Jordan (Hashemite Kingdom of Jordan), a small Arab country in the Middle East. Forbes rates Jordan money as the 4th strongest currency in the world.
The first Jordanian dinars were issued in 1950, replacing the Palestinian pound. JOD is pegged to USD at a rate of 0.7090 per 1 US dollar. This tie served the country well, keeping it from instability.
The country does not have lots of natural resources like its rich GCC neighbor, Saudi Arabia, but has a relatively well-diversified economy.
Jordan's governing leadership is aware of the importance of improving the business environment in the country, reducing bureaucracy, and modernizing the legal system and legislation.
The government has already taken a number of steps in each of these areas that could significantly strengthen the kingdom's ability to attract new investments.
The country also has relatively low inflation rates. As of April 2023, inflation was at 2.9% and then eased to 0.9% in July. Experts expect Jordan's annual inflation rate to decline steadily over the next few years.
The value of 1 JOD remained remarkably stable, ranging from 1.40 USD to 1.41 USD over the last 5 years.
Country: the United Kingdom
Currency rate: 1 GBP = 1.25 USD
The British pound sterling (GBP) is a legal tender in the UK and its 9 associated territories. This is the world’s oldest currency, which was introduced in 1489 for the first time.
Along with the Gibraltar pound, the British one is the 5th strongest currency worldwide. It is also the fourth most traded currency in the forex market after the US dollar, Euro, and Japanese yen.
Despite Brexit, sterling continues to be an essential currency in international trade and finance. The pound sterling is also the primary reserve currency of many central banks abroad.
A large number of international companies are required to pay with British currency for services, goods, or raw materials. As a result, the value of the pound sterling has not become any lower.
The pound sterling exchange rate has remained stable for many years in a row. Its average cost stayed at around 1.2-1.3 USD for 1 GBP.
Country: 20 member-states of the EU
Currency rate: 1 EUR = 1.07 USD
Euro (EUR) is a well-known currency used in 20 states of the European Union, commonly called the eurozone. It is the second most traded currency on the planet and one of the 10 most stable ones.
The Euro is the major currency of international trade and is also utilized as a crucial reserve currency by many central banks.
The introduction of the euro was aimed at promoting the economic integration of European Union countries and increasing the international competitiveness of the European economy.
The Euro was introduced into non-cash circulation in 1999, and banknotes and coins were introduced into cash circulation in 2002.
The euro is governed by the European System of Central Banks (ESCB), headed by the European Central Bank (ECB). ECB is responsible for the monetary policy of the whole eurozone, which makes it less dependent on local national governments compared to other foreign central banks.
Euro is a free-floating currency that is not pegged to any other currency. The average value of EUR in relation to the US dollar remained at 1.0-1.2 USD for 1 EUR during the last 5 years.
Country: Cayman Islands
Currency rate: 1 KYD = 1.20 USD
Cayman Islands are located in the western part of the Caribbean and are one of the UK's overseas territories. The local currency is the Cayman Islands dollar (KYD), first introduced in 1972 to replace the Jamaican dollar.
KYD is worth more than a US dollar (1 KYD = 1.20 USD), and its rate has stayed unchanged since 1974.
According to Forbes, the Cayman dollar is the seventh strongest currency in the world.
The domestic currency of the Cayman Islands is bolstered by the country’s being one of the most popular tax havens in the world. It has a reputation as one of the best offshore financial centers. The corporate tax rate there is 0%, as well as VAT.
Wealthy investors come to the Cayman Islands to set up their businesses, buy property, and keep their savings there, which helps to maintain the stability of the local economy and currency.
The issuing of local money is managed by the Cayman Islands Monetary Authority (CIMA). However, KYD value is pegged to the US dollar, so it is highly dependent on the US economy and its interest rates.
Country: Switzerland
Currency rate: 1 CHF = 1.12 USD
Switzerland is culturally and geographically part of Europe, but it is not in the EU. This country has its own strong and stable currency – the Swiss franc (CHF), which was first introduced in 1850. It is also used in Liechtenstein and some territories in Germany and Italy.
During the last 5 years, the fluctuation of the Swiss franc remained relatively moderate – from 2018 to 2023, 1 CHF cost around 1.0-1.5 USD.
Switzerland is famous for its robust economy, high standard of living, and one of the world’s strongest banking systems.
The country’s neutrality in international conflicts and stable political environment make its money extremely attractive for savings. The Swiss franc is known for its low inflation. Switzerland maintains an active policy to control inflation, which helps to preserve the purchasing power of this currency over time.
As of August 2023, the inflation rate in Switzerland was only 1.5%, the lowest since January 2022, when it stood at 1.7%. The inflation has been steadily decreasing since the beginning of 2023, starting from 3.3% in February to 1.6% in July and 1.5% in August.
The low inflation rates in Switzerland can be explained by its strong currency, lower reliance on fossil energy sources, and effective monetary policy.
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