Three main factors influence the strength of a currency. These are interest rates, economic policies, and stability.
Currencies with relatively higher interest rates attract foreign investors, increasing demand and price, thereby making it more robust. The opposite contributes to a weaker currency.
The economic policies which help keep inflation and debt in check influences the currency. Higher inflation and government debt can be bad for a country’s currency.
The stability of a state or economy attracts investors and increases the solidity of the currency. Countries that are not stable often have weak currencies.
Sao Tome and Principe Dobra
$1 is equivalent to 20.9053 STN
The Sao Tome and Principe Dobra is currently the weakest currency in Africa. The country is the smallest on the continent. Two island state is an exporter of cocoa, coffee, and coconuts. But this is not enough to support the local economy at an appropriate level.
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