What is the BHD (Bahraini Dinar)
Bahrain dinar (BHD) is the currency for Bahrain, an island nation in the middle east, which is east of Saudi Arabia and in the middle of the Arabian Gulf. The Bahraini dinar is made up of 1,000 fuloos, which is plural for fils and often uses the symbol BD when trading. It is a highly valued currency with pegging of 1 dinar to 2.652 U.S. dollars. The name dinar comes from the Roman denarius, which was the original standard silver coin used as currency during Roman times from 211 BC to around 244 BC.
BREAKING DOWN BHD (Bahraini Dinar)
Before 1965, Bahrain used the Persian Gulf rupee as their currency. Bahraini dinars began circulation in 1965 and replaced the Persian Gulf rupee at a conversion rate of 1 dinar to 10 rupees. Until 1973, the Bahrain Currency Board issued banknotes. After 1973, this responsibility fell under the control of the Bahrain Monetary Agency.
In 1980, the dinar begin pegging to IMF’s Special Drawing Rights, with a fixed rate of 0.376 dinars to 1 USD. In October of 1989, the Bahrain dinar (BHD) reached an all-time USD exchange rate high of 2.66. However, through the 1990s, the BHD struggled with low values against the USD. For instance, in December of 1993, the BD had seen its lowest rate of 0.37. Most of these changes are due to instability in the region.
By 2006, the Bahrain Agency transitioned and renamed as the official Central Bank of Bahrain (CBB). During this time, the country was also becoming more economically stable and going through many changes at a developmental level. By 2008, the Central Bank of Bahrain launched a new group of banknotes, which were technically its fourth official series of notes. This new issue honored both the bright future of Bahraini and reflected upon its past heritage.
The CBB oversees both conventional and Islamic banks. They also have oversight of insurance, investment firms, brokers, and other financial institutions.
Although the country has struggled economically, without an agricultural industry and high rates of unemployment, currently Bahrain is rated to be the fastest-growing economy of the Arab countries. According to World Bank data, the country experiences a 5.7% annual inflation rate and has a gross domestic product (GDP) growth of a 3.9%, as of 2016, which is the most current year of available data.
The Bahrain dinar banknotes have denominations of 5, 10, 25, 50, 100, 500 and 500 dinar. The country also has coins valued at 1, 5, 10, 20 fuloos. The Central Bank of Bahrain manages the currency.
The BHD uses the symbol of .د.ب in Arabic and BD in Latin. Bahrain also accepts all of the currency of Saudi Riyal, other than the 500 riyals notes.
Beginning in 2016 the Bahrain dinar began circulation of notes with enhanced security features. The new notes also have raised lines to assist the visually impaired.