World Currencies Basics

Deal in currencies of the world from dollars to dalasis
By Lori Rogers-Stokes There are over 150 major currencies of the world out there, each with a frequently changing value in relationship to other world currencies. Whether you do business with international clients and need exchange rates, or you invest and need stock-related information regarding major world currencies, or you're traveling and need to convert dollars to foreign currencies, it's important to understand the basics of currencies from around the world.

There are three main areas of interest to the average U.S. citizen investigating world currencies: the euro (since most Americans travel most often to Europe), the major world currencies (since they drive economic activity around the world), and the dollar, because the U.S. Dollar is still a standard for establishing the value of other currencies. In this guide, we'll look at how to:

1. Map the Euro and find out where it is used;

2. Evaluate the major currencies of the world and their values; and,

3. See the U.S. Dollar in a global light.

Connect the dots to find out where the Euro is a major world currency

It's called the euro, so it must be used in Europe, right? Or at least in countries that are part of the European Union? It's not that simple; the euro is not used generally throughout Europe, but it's still one of the most powerful currencies of the world, and well worth studying.
Try:  Learn "Why 13 Countries Use the Same Money" at University Credit Union, which provides a list of euro-using nations and a brief history of the currency. Go to CoinMill.com to convert euros to dollars and back again, and see photos of euro notes and coins at ASIATravelTips.com.

Bank on the strength of the major currencies of the world

Of those 170 or so world currencies, which are the strongest, most stable, and most easily traded? Foreign currencies are judged by many standards, including their U.S. Dollar reserve, economic growth, and low inflation. Different currencies are judged the strongest at different times, but the same contenders are always in the race.
Try:  Know your world currencies basics by starting with a list of world currencies from The University of British Columbia Sauder School of Business. Get one reliable ranking of the Top 30 World Currencies at Exchange-Rates.org. Learn how five major world currencies are ranked at "What's the strongest currency in the world?," from BloggingStocks.

Appreciate the dollar in its role as an international currency

The United States took a long time to establish -- and really use -- the dollar as its official currency. Federally minted dollars were not enforced as currency until the Civil War. But, the world picked up on the U.S. Dollar right away, and despite the growth of other national economies, the U.S. Dollar remains a currency standard for the world.
Try:  Learn why the U.S. Dollar is world currency at Investopedia, which explains how other nations use or rely on U.S. greenbacks. At The New York Times you can read an article that details why foreign nations adopt the U.S. Dollar as their currency.

• Three countries other than the U.S. use the actual U.S. Dollar as their currency: Ecuador, El Salvador and Timor-Leste. Eight countries compare the value of their currency directly to the U.S. Dollar: Bahamas, Barbados, Belarus, Belize, Bermuda, Hong Kong, Lebanon and Saudi Arabia.