Which country's currency is the cheapest? Understand the top 10 weakest currencies in the world in 2026

In the global financial markets, which country’s currency is the cheapest? This question has an interesting answer because many currencies are experiencing severe devaluation. The main factors causing currency depreciation include high inflation rates, political instability, lack of economic diversification, and international sanctions. This article will explore the 10 lowest-valued currencies in the world and help you understand why they are like this.

Comparison Table of the World’s Lowest-Valued Currencies

The Lowest-Value Currencies: What Are They?

1. Lebanese Pound (LBP) - The Cheapest Currency in the World

The Lebanese Pound, also called the Lira, has been Lebanon’s official currency since 1939. Before that, Lebanon used the French Franc. Historically, the Lebanese Pound was pegged tightly to the US dollar, but political turmoil and a prolonged economic crisis have pushed this currency into a severe crisis.

The country with the lowest currency in this context is Lebanon, which has faced the most significant economic crisis in modern history. Since 2019, Lebanon’s economy has collapsed, with triple-digit inflation, widespread poverty, and banking sector disruptions. The Lebanese government defaulted on debt payments in 2020, and the Lebanese Pound has lost over 90% of its value on the currency markets.

Causes of Lebanon’s Crisis:

• Economic collapse, soaring inflation, and bank failures
• Political instability and internal conflicts
• Heavy reliance on foreign aid but limited support
• Multiple exchange rates, with official controls but free-market divergence

2. Iranian Rial (IRR) - Result of Economic Sanctions

The Iranian Rial has a long history dating back to the 19th century when Iran was still called Persia. In 1932, a new Rial was introduced, pegged to the British Pound. However, the Islamic Revolution of 1979 drastically changed the country’s structure and economy.

The extremely low value of the Rial is mainly due to sanctions. Iran is a prime example; the Rial is among the weakest currencies because the US and its allies have imposed severe sanctions for decades, crippling the economy and hindering development.

Main factors making the Rial so weak:

• Economic sanctions from the US and international community
• Heavy dependence on oil exports
• Continuous high inflation
• Ongoing geopolitical tensions
• Poor economic management by the government

3. Vietnamese Dong (VND) - From Crisis to Growth

The Vietnamese Dong originated in 1954 when Vietnam was divided into North and South. After the Vietnam War ended, the Dong became the single currency nationwide. Initially, the Dong suffered from high inflation, low value, and multiple economic reforms.

Since the 2000s, Vietnam’s economy has improved, and the Dong has gradually appreciated. However, Vietnam still uses a managed floating exchange rate system, giving the central bank control over volatility to prevent sharp fluctuations.

Additional info about the Dong:

• A weak currency is advantageous for Vietnam’s trade surplus
• It provides a competitive edge in exports
• Reflects successful economic reforms and openness to foreign investment

4. Laotian Kip (LAK) - A Symbol of Slow Economic Development

The Laotian Kip has been the official currency since 1952, three years after independence. Initially pegged to the French Franc, the Kip has become more volatile since the 1990s, as Laos implemented multiple economic reforms.

Laos is one of the least developed countries in the region, with growth lagging behind neighbors. It relies heavily on agriculture and resource exports, limiting foreign investment.

Reasons for the low value of the Kip:

• High inflation, especially post-COVID-19
• Dependence on agriculture and natural resources
• Limited industrial and service sectors
• Lack of global integration
• Managed float system linked to the dollar and Thai baht

5. Indonesian Rupiah (IDR) - A Developing Market Currency

The Indonesian Rupiah has been among the lowest-valued currencies for decades. Indonesia gained independence from the Netherlands in 1945 and has used the Rupiah since then. Initially, it was pegged to the Dutch currency.

As a developing country with the fourth-largest population globally, Indonesia experienced significant growth over the past two decades. Nonetheless, the Rupiah remains vulnerable to fluctuations because Indonesia is a commodity-exporting emerging market.

Factors contributing to the Rupiah’s weakness:

• Dependence on commodity exports like palm oil and minerals
• Sensitivity to global commodity prices
• Vulnerability to international investor decisions
• Limited economic diversification and reliance on exports

6-10. Other Low-Value Currencies

Besides the currencies above, there are others like the Uzbek Sum (UZS), Guinean Franc (GNF), Paraguayan Guarani (PYG), Malagasy Ariary (MGA), and Burundian Franc (BIF), all with very low values.

These currencies share common traits: reliance on agriculture or natural resources, small economies, high inflation, political instability, and limited foreign investment.

What Drives Currency Values: Why Are Some Countries’ Currencies So Cheap?

Exchange rates are influenced by various factors:

1. Interest Rates and Inflation - Countries with high interest rates attract foreign investment, strengthening their currency. Conversely, high inflation erodes purchasing power, weakening the currency.

2. Balance of Payments - Countries with trade surpluses tend to have stronger currencies, while deficits increase demand for foreign currency, weakening the local currency.

3. Political Stability - Political unrest, conflicts, and sanctions reduce investor confidence, leading to currency depreciation.

4. Economic Diversification - Economies with diverse sectors are more stable; reliance on commodities or a single sector makes currencies more vulnerable.

Summary: Understanding the Cheapest Currencies in the World

The cheapest currencies are not random; they result from complex economic, political, and international factors. Most devalued currencies come from countries facing crises, high inflation, political instability, and limited economic diversification.

For travelers and investors, understanding which currencies are the cheapest can influence travel costs, investment decisions, and insights into global economic conditions. Monitoring exchange rates and geopolitical developments helps make informed decisions and prepares for shifts in the global financial landscape.