Economy
A Look at Unstable Economies: What are the Weakest Currencies in 2025?
While people are mostly turning their heads at the most powerful currencies worldwide, it is always a good idea to glance at the weakest, to learn from their stories and mistakes. Every country worldwide wants to achieve economic stability, as this shows strength. Still, this objective has become challenging as we are dealing with a lot of problems worldwide, including political issues, inflation, and economic concerns.
Weak currencies have low buying power, and at the moment, the weakest currency in the world is the Lebanese pound. The Iranian Rial, the Laotian Kip, the Uzbekistani Som, the Syrian Pound, the Guinean Franc, and the Paraguayan Guarani follow this currency.
In this article, we will analyze the factors that can impact a currency’s strength and delve into the world’s weakest currencies. Keep reading to learn more.
What are the factors that impact the strength of fiat money?
Economic factors
Economic factors are among the most important aspects that can tell whether a currency is strong or weak. Ideally, a country should have a low inflation rate so that it can have better purchasing power over other currencies. On the other hand, countries with high inflation will experience a depreciation in their currencies, as this will also lead to high interest rates, which will impact the strength of a currency.
So, a combination of inflation, interest rates, and exchange rates determines whether a currency is strong or weak.
Political factors
Politics will also impact the strength or weakness of a digital coin. Unfortunately, many countries around the world are experiencing political issues, such as corruption or government changes, that can lead to currency devaluation. When important political events occur, like wars, citizens will be more inclined to exchange their money for another currency, which can create even more devaluation.
The collapse of the Lebanese pound is the result of poor political and economic management. Other countries dealing with weak currencies are North Korea and Iran, which have received many international sanctions over the years. Because of this, they have not been as open to global financial markets.
External factors
External factors can also determine whether a currency remains strong or weakens. When a high number of investors are interested in a coin, they can make it even stronger. Additionally, countries own a foreign exchange reserve, representing the holdings of a country of liquid assets and foreign currencies, which nations can use when they want to stabilize their currency. Of course, the ones with a high reserve can better protect themselves from financial shocks. The ones with a high reserve, like Switzerland and China, have the means to prevent currency depreciation.
On the other hand, those with little reserves, like Sri Lanka and Pakistan, are more inclined to devalue their currency. Additionally, a nation’s resources, such as gas, oil, gold, or agricultural goods, can also impact the value of a currency. In this regard, when the price of a commodity rises, a country can gain more revenue and strengthen the position of its currency. This also occurs in reverse.
What are the weakest currencies in the world?
Lebanese pound (LBP)
At the moment, the Lebanese pound is the weakest currency in the world. The fiat money of Lebanon has struggled to maintain a high position and has suffered significant depreciation. This is the result of massive economic challenges, political instability, hyperinflation, and crisis. The ones who have felt the disadvantages of this are the Lebanese, who now need to face the effects of currency devaluation. Corruption and the collapse of the banking sector are other reasons that have led to the devaluation of the currency.
Iranian Rial (IRR)
The second weakest currency title belongs to the Iranian rial, as a result of the heavy sanctions that were imposed on this country back in 2015. Then, the Iranian rial also depreciated because it went through new pressure due to the tensions in the Middle East. Because of the sanctions, Iran hasn’t been able to participate that much in international trade, and this is also accompanied by political instability and high inflation.
Laotian Kip (LAK)
The Laotian Kip was also a weak currency in 2015. It is in its current state because of many factors, among the most obvious ones being high inflation, foreign debt, and economic pressures. Trade imbalances, lack of industrialization, and limited foreign investment are other reasons for this.
Uzbekistani Som (UZS)
Uzbekistan has important gas and oil reserves, which is why some might say that this country has everything it needs for a high-value currency. However, this doesn’t apply to Uzbekistan, which has struggled to maintain a high currency value. Unfortunately, Uzbekistan didn’t recover from the Soviet era, and this can be seen in the high inflation and corruption.
Syrian Pound (SYP)
The Syrian pound has become a weak currency because of economic sanctions and the civil war, which has affected this country’s currency. Investors are not interested in investing in this currency, and residents are very inclined to move their money into other currencies to escape inflation.
Conclusion
Unfortunately, many countries around the world have unstable economies, which greatly impact currency devaluation. Unstable countries are synonymous with high inflation, which decreases a coin’s purchasing power. Unfortunately, not many countries recover from unstable economies, as this can create a vicious cycle that, in the end, will impact currency value.
Investors are less likely to risk putting their money in unstable economies, where countries are dealing with corruption and high inflation. The political instability can lead to even more losses in the value of a currency, and this has been seen in numerous examples over the years.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its stay in the south territory with a decline of 0.56 per cent on Wednesday, April 2.
This brought down the market capitalisation by N13 billion to N2.417 trillion from N2.430 trillion, and downed the NASD Unlisted Security Index (NSI) by 22.57 points to 4,062.87 points from the previous session’s 4,062.87 points.
It was observed that the NASD exchange ended with three price gainers and three price losers during the trading day.
MRS Oil Plc depreciated by N19.00 to close at N171.00 per unit compared with the previous price of N190.00 per unit, NASD Plc lost N4.14 to trade at N37.36 per share compared with Wednesday’s N41.50 per share, and Central Securities Clearing System (CSCS) Plc gave up N2.00 to sell at N78.00 per unit versus N80.00 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc appreciated by 19 Kobo to N93.00 per share from N92.81 per share, Food Concepts Plc expanded by 15 Kobo to N2.87 per unit from N2.72 per unit, and Great Nigeria Insurance (GNI) Plc improved by 2 Kobo to 52 Kobo per share from 50 Kobo per share.
Yesterday, the volume of securities dipped by 91.8 per cent to 260.2 million units from 3.2 billion units, the value of securities went down by 98.1 per cent to N154.2 million from N8.3 billion, while the number of deals soared by 53.3 per cent to 46 deals from 30 deals.
GNI Plc was the most active stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 56.9 million units valued at N3.9 billion, and Okitipupa Plc with 27.5 million units traded for N1.8 billion.
The most traded stock by volume on a year-to-date basis was also GNI Plc with 3.4 billion units sold for N8.2 billion, trailed by Resourcery Plc with 1.1 billion units exchanged for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units transacted for N1.2 billion.
By Adedapo Adesanya
The Naira dropped N2.09 or 0.15 per cent against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, April 2, to trade at N1,380.79/$1 compared with Wednesday’s rate of N1,378.70/$1.
However, it appreciated against the Pound Sterling in the official market by N2.77 to quote at N1,824.86/£1 versus the N1,836.57/£1 it was traded at midweek, and improved its value against the Euro by N10.54 to N1,591.92/€1 from N1,602.46/€1.
Yesterday was the last trading session of the week for the local currency in the spot market, as the market will be closed on Friday and Monday for the Easter Holiday.
At the black market, the Nigerian Naira maintained stability against the greenback yesterday at N1,405/$1, but gained N8 at the GTBank FX counter to settle at N1,388/$1, in contrast to the previous session’s N1,396/$1.
Pressure eased on the domestic currency as strong policy indicators have helped calm the majority of worries within the financial systems. Particularly in the remittance segment, the apex bank has directed all International Money Transfer Operators (IMTOs) to route remittance transactions through designated Naira settlement accounts in banks, a move aimed at boosting transparency and channelling more foreign exchange into the formal market.
This helps take off pressure from the foreign reserves, which have fallen below the $50 billion mark as they are gradually decreasing rather than falling sharply.
Meanwhile, the cryptocurrency market was bullish on Thursday, as macro sentiment shifted against recent optimism after reports that Iran is drafting a protocol with Oman to manage traffic through the Strait of Hormuz, easing concerns about disruptions to a key global oil route.
The remarks came after U.S. President Trump on Wednesday night vowed to hit Iran “extremely hard” in the coming weeks and that the Strait of Hormuz would “open naturally” once the war ends.
Cardano (ADA) chalked up 1.9 per cent to trade at $0.2435, Dogecoin (DOGE) grew by 1.2 per cent to $0.0912, Ethereum (ETH) appreciated by 0.8 per cent to $2,066.37, Bitcoin (BTC) added 0.5 per cent to sell at $67,080.53, Solana (SOL) increased by 0.5 per cent to $79.91, and Ripple (XRP) jumped 0.2 per cent to $1.31.
Conversely, Binance Coin (BNB) dipped 0.7 per cent to $586.90, and TRON (TRX) depreciated by 0.3 per cent to $0.3147, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.
By Dipo Olowookere
The local stock market was relatively flat on Friday, as the bears and the bulls shared the spoils of war, though investor sentiment turned bullish compared with the preceding session’s bearish posture.
Data from the Nigerian Exchange (NGX) Limited showed that the All-Share Index (ASI) was marginally down by 4.66 points as it ended at 201,698.89 points versus Wednesday’s 201,703.55 points, and the market capitalisation slightly contracted by N3 billion to N129.806 trillion from N129.809 trillion.
Customs Street was shut on Friday because of the public holidays declared by the federal government today and next Monday.
Business Post reports that John Holt declined by 9.91 per cent to N15.45, Abbey Mortgage Bank shed 9.60 per cent to trade at N8.95, International Energy Insurance slipped by 6.48 per cent to N3.32, Chams shrank by 5.30 per cent to N3.75, and Tantalizers depreciated by 5.18 per cent to N4.03.
On the flip side, Unilever Nigeria improved by 10.00 per cent to N103.40, Fortis Global Insurance gained 9.82 per cent to trade at N1.23, Multiverse appreciated 9.81 per cent to N20.15, Legend Internet advanced by 9.38 per cent to N6.30, and Zichis grew by 9.02 per cent to N14.14.
The market breadth index was positive during the trading session, as there were 35 appreciating stocks and 24 depreciating stocks.
Yesterday, investors traded 560.0 million equities valued at N19.3 billion in 49,676 deals, in contrast to the 815.5 million equities worth N33.3 billion transacted in 52,641 deals in the preceding day, representing a drop in the trading volume, value, and number of deals by 31.33 per cent, 42.04 per cent, and 5.63 per cent, respectively.
Secure Electronic Technology dominated the activity log with 59.7 million shares valued at N61.1 million, Wema Bank exchanged 52.0 million equities worth N1.4 billion, VFD Group transacted 36.0 million stocks for N410.5 million, Access Holdings sold 35.3 million shares valued at N914.8 million, and Chams traded 31.0 million equities worth N115.0 million.
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