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What is the world’s weakest currency?
The US dollar is generally regarded as the strongest currency and is certainly the most traded by some margin.
The dollar may not be the strongest currency in the world (its bragging rights are in the Kuwaiti Dinar), but it is near the top of the approximately 180 traditional fiat currencies that are recognized as legal tender around the world.
At the other end of the scale, the weakest currencies trade at just a fraction of the dollar. And depending on the currency, tens of thousands of units may be required to buy just a dollar.
Let’s take a look at the top 10 weakest currencies in the world based on their relative value to the US dollar.
How are foreign currency prices determined?
Foreign currencies are traded in pairs. For example, use British pounds to buy US dollars. As a result, a currency is always priced relative to another currency known as the “exchange rate”.
Most currencies are “floating” currencies, meaning their value fluctuates depending on supply and demand. However, some currencies are “pegged”. This means that its value relative to another currency (such as the US dollar) is fixed at an agreed rate.
Exchange rates affect the cost of goods and services in foreign currencies. For example, if the pound rises against the dollar, vacations in the United States will cost less in pounds.
However, exchange rate fluctuations also present opportunities for investors looking to profit from foreign exchange trading. We have created a guide that explains the basics of forex movement and our pick of the best forex brokers.
Please note that any form of market-based investment or speculation puts all funds at risk. Investments can go up and down in value and you may lose some or all of your funds. Leveraged products such as contracts for difference are highly speculative and carry the added risk of losing more than the amount originally wagered.
What are the top 10 weakest currencies?
We analyzed the weakest currencies based on the number of foreign currency units received in exchange for 1 USD. Exchange rates are obtained from our currency converters based on Open Exchange data at the time of writing.
Here are the top 10 weakest currencies:
1. Iranian Rial (IRR)
The Iranian rial is the weakest currency in the world, with only 0.000024 US dollars being bought for 1 rial (in other words, 1 dollar is equivalent to 42,273 Iranian rials).
The Iranian rial was first introduced in the late 1700s. It was then pegged to the British pound and then to the US dollar. Although it is currently a floating currency, it has hovered around 1 dollar = 42,000 rials for the past few years.
Located in the Persian Gulf between Iraq and Afghanistan, Iran is one of the world’s leading exporters of oil and natural gas. But economic sanctions, along with political instability and high inflation, are putting pressure on Iran’s currency.
2. Vietnamese Dong (VND)
The Vietnamese dong is the second weakest currency in the world, with 1 dong being bought at USD 0.000042 (or 1 dollar equals 23,711 Vietnamese dong). The Dong entered circulation in 1978 and employs a “crawling peg” to the US dollar (meaning it may fluctuate gradually over time).
Vietnam faces the South China Sea and borders China, Laos, and Cambodia. Services account for the largest share of gross domestic product (GDP), followed by industries such as electronics, energy and textiles.
Vietnam’s currency has been undermined by restrictions on foreign investment and a recent slowdown in exports, as well as rising US interest rates.
3. Lao Skip (LAK)
Laos or Laotian Kip is the third weakest currency, 1 Kip buys $0.000052 (or 1 USD is equivalent to 19,072 Laotian Kip). Kip was introduced in the 1950s and is free-floating.
Laos is a landlocked country surrounded by Vietnam, Thailand, Cambodia, and China, and is heavily dependent on exports of copper, gold, and timber.
The country is suffering from slowing economic growth, rising external debt and high inflation, putting pressure on its currency.
4. Sierra Leone Leone (SLL)
The Sierra Leonean leone is the fourth weakest currency in the world, with 1 leon bought at $0.000057 (or $1 equals 17,665 Sierra Leonean leone). This currency was first introduced in 1964 and is a free-floating currency.
Sierra Leone is located in West Africa, bordering Guinea and Liberia. Major exports include wood and minerals such as diamonds, gold and industrial metals.
Leone’s value has been eroded by over 40% inflation, high debt, slowing economic growth and the long-term effects of the Ebola epidemic.
5. Indonesian Rupiah (IDR)
The Indonesian rupiah is the fifth weakest currency in the world, with 1 rupiah buying US$0.000067 (or 1 dollar equals 14,993 Indonesian rupiah). The rupiah was introduced in 1946, initially pegged to the US dollar, but then transitioned to a floating currency.
Indonesia is made up of over 17,000 islands in the Pacific Ocean, including parts of Java, Sumatra, Borneo and New Guinea.
It has the largest GDP in Southeast Asia thanks to its service sector, and is also rich in primary commodities. However, the rupiah fell against other currencies on fears of high inflation and recession.
6. Lebanese Pound (LBP)
The Lebanese pound is the 6th weakest currency in the world, bought at US$0.000067 per pound (or one dollar equals 14,986 Lebanese pounds). The pound was first introduced in the 1930s and is pegged to the US dollar.
Lebanon borders the Mediterranean Sea, Israel and Syria. We have a service-based economy, but we also export precious stones and metals, chemicals, food and beverages.
The Lebanese pound has fallen to a record low against the US dollar in early 2021 due to a severe economic slowdown, high inflation and unemployment, a banking crisis and political unrest.
7. Uzbekistan Som (UZS)
The Uzbekistani som is the 7th weakest currency in the world, with 1 som buying $0.000087 (or $1 equals 11,516 Uzbekistani soms). Introduced in 1993, it is free-floating.
Uzbekistan is a former Soviet republic located in Central Asia. It is one of the world’s leading cotton exporters and has extensive mineral, oil and gas reserves.
The country has implemented economic reforms but still suffers from low economic growth, high inflation, unemployment and corruption.
8.Guinean Franc (GNF)
The Guinean franc is the 8th weakest currency in the world, with 1 franc buying $0.000116 (or $1 equals 8,583 Guinean francs). This currency was introduced in 1959 and is a free-floating currency.
Guinea is a former French colony in sub-Saharan Africa. Rich in natural resources such as gold and diamonds, it suffers from high inflation, military instability and an influx of refugees from neighboring Liberia and Sierra Leone.
9. Paraguayan Guarani (PYG)
The Paraguayan Guarani is the 9th weakest currency, with 1 Guarani bought at $0.000138 (or $1 equals 7,249 Paraguayan Guarani). Introduced in 1952, it is free-floating.
Paraguay is a landlocked country and shares borders with Brazil, Argentina and Bolivia. The country is a major producer of soybeans, stevia (a sugar substitute) and beef, and also exports corn and sugarcane.
But that currency is being squeezed by high inflation, corruption and counterfeit currency.
10. Ugandan Shilling (UGX)
Last on the list is the Ugandan shilling, where 1 shilling is purchased for $0.000273 (or 1 dollar is equivalent to 3,669 Ugandan shillings). First published in 1966, it floats freely.
Uganda is a landlocked country in East Africa, bordering Kenya, South Sudan, Tanzania and the Democratic Republic of the Congo.
The country is rich in commodities such as oil, gold and coffee, but its economy is plagued by erratic economic growth, high debt and political instability.
