weakest currencies in Europe Hungarian forint is number one

5 Weakest Currencies in Europe

There are different ways to measure the strength of a currency. If it’s by the purchasing power, the strength of money can not be the same even if five countries use the same currency.

Tricky Riddles with Answers
Tricky Riddles with Answers

In this article, we measure the exchange rate of the United States Dollar (USD) against the local currencies in Europe.

It’s important to note that 23 countries in Europe adopt Euro as their official currency, so their currency is protected by the power of the Euro.

The continent is also famous for its formation of a political and economic bloc which is today known as the European Union.

Out of the 27 members of the EU, 19 are in the Euro-area (eurozone countries) while there are at least five non-EU member countries that get the approval of the EU to use the Euro as their official currency.

Although, it may be difficult to conclude which currencies are the weakest if one reads an introductory book about the exchange rate. But in comparison to the USD, coming up with a list of the weakest currencies in Europe become easy to make.

The fact that some countries are yet to adopt Euro (or are not planning to) might have exposed them to some monetary threats and weaknesses.

Note: No Eurozone country makes the list below which doesn’t mean they are not faced with some challenges back home.

So…

What are the weakest currencies in Europe?

Hungarian forint (HUF)

  • USD to HUF = HUF333.76
  • Euro to HUF = HUF367.53

The Hungarian forint is the official currency of Hungary, an Eastern Europe country. Forint was introduced on August 1, 1946, as one of the measures to throw World War II behind it and make significant progress.

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That seemed to work temporarily until it transited its economy into the market economy and the value of forint dropped in the forex market.

From the early 1990s to date, the Hungarian economy has been battling with how to control inflation even though it has been kept in the single digits.

Hungary is one of the EU members that is yet to adopt the Euro as its official currency, though it is making plans to join the Euro-area, it is yet to set a definite date to adopt the Euro

Icelandic krona (ISK)

  • USD to ISK = ISK128.24
  • Euro to ISK = ISK141.61

The official currency of Iceland is Krona. The country is the smallest country (in terms of population) in Northern Europe.

Like Hungary, high inflation, especially in the 1980s, has been one of the impediments to the value of the Icelandic krona

At the time of publication, $1 is worth 128.24 Icelandic krona, making it one of the weakest currencies in Europe.

Albanian lek (ALL)

  • USD to ALL = ALL111.15
  • Euro to Lek = ALL123.25

The Albanian lek is a closed currency, meaning it can not be exchanged abroad. For travellers, they exchange Euro and pounds to Lek in Albania.

But against the USD, that has not made the lek a stronger currency nor against the Euro.

$1 is worth 111.15 Lek while one Euro is worth 123.25 Lek in Albania.

When will Albania adopt Euro?

There is no definite date.

Serbian dinar

  • USD to RSD = RSR106.17
  • Euro to RSD = RSR117.74

In Southern Europe is Serbia, its official currency is the dinar. The dinar has undergone several changes and modifications in the country’s monetary system after it replaced the Yugoslav dinar in 2003.

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Russian rubble

  • USD to RUB = RUB87
  • Euro to RUB = RUB96.43

Note: Because of the invasion of Ukraine on February 24, 2022, sanctions from the West and some European countries have pushed Russia to cut rates on April 8, 2022, making the ruble gain against the US dollar, $1 was worth 79.68 RUB (at the time of update)

The rubble is the official currency of Russia, the most populated country in Europe. Since Russia invaded Ukraine on Thursday, February 24, 2022, sanctions from the West (the United States and its allies) has plunged the gas-rich country into battle with the monetary crisis, especially at the forex market.

Rubble as continued to slide even as the Putin-led government put in place measures to regulate the circulation of USD in his country.

The Russian currency continues to lose its purchasing power, though the country’s central bank is trying to prevent exchanges into dollars, it has not stopped the slide.

For instance, on Wednesday, March 16, 2022, Russian central Bank rolled out another stringent policy by restricting access to U.S. dollars.

Investors would no longer be allowed to withdraw anything above $10,000 in USD while the rest would have to be taken out in rubles.

At the time of publication, financial institutions cannot sell foreign currency to Russia. Have the policies helped? No, at least for now. We’ll continue to monitor it until September 9, 2022, when the country plans to review the restrictions.

Until then, rubble remains the fifth weakest currency against the USD at this hour. Worthy of note is the Maecedian official currency

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Macedonian denar

  • USD to MKD = ISK55.75
  • Euro to MKD = ISK61.81

After its independence from Yugoslavia on September 8, 1991, the first denar came into being on April 26, 1996, thereby ending the old Yugoslav dinar at par.

But after its monetary independence, the economic policies of the Southern European country is yet to stabilise its local currency.

Just $10 is worth ISK1,114.9 in Macedonia, making it one of the struggling currencies in Europe. Will it be saved if it joins the Eurozone?

At the forex market, it might. At home, it might not if it fails to put in place measures to monitor inflation and increase exports.

The Macedonian denar, Russian rubble, Serbian dinar, Hungarian front may the weakest on that continent, it’s important to note that GBP, Euro, Swiss franc remain the strongest currencies in Europe.

Sources:

  1. Featured Image by Hungary Today
  2. András Balogh (2021). “The Hungarian forint was the worst currency in Central Europe last year”. Dailynewshungary.com. Retrieved March 28, 2022
  3. Eshe Nelson (March 9, 2022). “Russia’s ruble continues its slide as new curbs restrict access to foreign currency”. Nytimes.com. Retrieved March 29, 2022

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