More than 10 of the world's cheapest currencies in the year 2025

There are dozens of currencies around the world with the lowest values, caused by various economic and political factors. Let’s examine the reasons behind these countries’ weak currencies and low exchange rates compared to the US dollar.

Table of the world’s lowest exchange rate currencies

Causes of the world’s lowest currencies

Low-value currencies are no coincidence. The main factors include high inflation rates, political instability, lack of economic diversification, insufficient foreign investment, and sanctions imposed by other countries.

Weak economic structures

Most countries with the lowest currencies rely heavily on commodity exports and natural resources. This dependence makes their economies vulnerable to global commodity price fluctuations. Additionally, these economies lack significant industrial and service sector development, limiting their capacity to add value.

Case Study: Lebanon’s catastrophic crisis

The Lebanese Pound has proven to be one of the world’s lowest currencies due to the country’s severe economic crisis since 2019. Lebanon has experienced triple-digit inflation, a major economic downturn, and banking system collapse. In the parallel market, the Lebanese Pound has lost over 90% of its value, clearly illustrating political and economic instability.

Middle East: Impact of sanctions

The Iranian Rial has been ranked among the world’s lowest currencies for years. Iran faces strict economic sanctions from the US and allies, putting pressure on its economy. Heavy reliance on oil exports and ongoing geopolitical tensions keep the currency depressed, with high inflation rates.

Southeast Asia: Diverse challenges

Vietnamese Dong: Managed floating and growth

Vietnam’s economy is growing, but its currency remains weak due to a managed floating exchange rate policy by the central bank. However, this low currency value benefits Vietnam by maintaining a trade surplus, giving it a competitive edge internationally.

Laotian Kip: Slow economic development

Laos is one of Southeast Asia’s least developed countries. The Laotian Kip is among the lowest currencies because Laos depends heavily on agriculture and struggles to attract foreign investment. Post-COVID-19 inflation has further devalued the currency.

Indonesian Rupiah: Balance and resilience

Despite Indonesia being one of Southeast Asia’s largest economies, the Rupiah remains among the lowest currencies. The country relies on commodity exports, but foreign investment in tourism and direct investment helps stabilize the currency.

Central Asia: Controlled economies and reforms

Uzbekistan’s Sum is among the lowest currencies. The country faces economic development challenges, heavily reliant on resource exports. Although reforms have begun, inflation and lack of foreign investment continue to impact its currency value.

Africa: Weak infrastructure and instability

Guinean Franc: Instability and lack of stability

The Guinean Franc is among the lowest currencies, reflecting ongoing political instability, weak infrastructure, and economic fragility. Corruption and governance issues hinder development, contributing to its low value.

Malagasy Ariary: Small economy

Madagascar’s economy depends on agriculture, tourism, and resource exports. The Ariary’s low value highlights the country’s economic vulnerabilities and limited financial options.

Burundian Franc: Long-standing crisis

Burundi is one of the poorest countries globally. The Franc faces downward pressure from chronic trade deficits, food insecurity, and political unrest.

South America: Commodity dependence risks

The Paraguayan Guarani is among the lowest currencies. Paraguay’s small economy relies on agricultural exports like soybeans and meat. While experiencing some growth, it faces trade deficits and rising debt.

Key factors influencing exchange rates

The exchange rate of the lowest currencies is affected by inflation, interest rates, public debt, and current account balances. Higher interest rates often attract foreign investment, increasing demand for the local currency and raising its value. Conversely, low inflation tends to strengthen a currency.

A current account deficit indicates more imports than exports, increasing foreign currency demand and devaluing the local currency. Economic recession often leads to lower interest rates, reduced foreign investment inflows, and currency depreciation.

Conclusion: Understanding the world’s lowest currencies

The world’s lowest currencies reflect economic and political challenges faced by these countries. Understanding the underlying factors helps investors and businesses make better decisions regarding currency trading and investments. The interplay of monetary policy, inflation, and political stability demonstrates the complexity of the global currency markets.