What is the OMR (Oman Rial)
OMR is the abbreviation for the foreign exchange (FX) currency, the Omani rial. The OMR is the national currency of the Sultanate of Oman. The Omani rial is made up of 1000 baisa. Since the last change in parity in 1986, the Central Bank of Oman has maintained the value of the Omani rial $2.6008. The OMR (Oman Rial) is the third most valuable currency in the world.
Circulation of the OMR is in banknote with denominations of 100 baisas, one-half, one, five, 10, 20, and 50 rials. Coins have denominations of 5, 10, 25, and 50 baisas.
BREAKING DOWN OMR (Oman Rial)
The Central Bank of Oman pegs the value of the Omani rial to the U.S. dollar (USD) at a fixed exchange rate. Between 1973 and 1985 the rate held at 1 rial to USD 2.895 but changed to $2.6008 in 1986. The dollar peg keeps the value of the rial stable and protects against the volatility which small, trade-and-resource-based economies like Oman’s can experience.
Oman is both a very open economy, with 77 percent of its economic output the result of trade, and one that is heavily dependent on oil, making the economy and the currency heavily influenced by the price of oil. Like many oil-rich nations, Oman is attempting to diversify its economy away from dependence on oil. Omani officials are directing particular attention to manufacturing, tourism, and logistics, given its coastal geography at a critical crossroads of the world. Until Oman can achieve a more diversified economy, with a more developed financial system, it is likely that the Omani rial will remain pegged to the dollar.
According to World Bank data, Oman's population is growing slowly. The country experiences 9.0% annual inflation rate and has a gross domestic product (GDP) of negative 0.3%, as of 2016, which is the most current year of available data.
History of the Omani Rial
Oman sits on the Strait of Hormuz at the Persian Gulf and has is key to stability in the region. Before 1970, Oman did not have a national currency. Earlier the area, then known as Muscat and Oman, used the Indian rupee (INR) and the Maria Theresa thaler with different money seeing circulation in different regions.
Beginning in 1970, the OMR was known as the rial Saidi and had a value equal to the British pound (GBP). This currency became popular and replaced the Indian rupee in coastal regions. By 1973 the currency was renamed the rial Omani and became the predominant form of money. OMR became the currency of Oman after Sultan Qaboos bin Said officially changed the name of the country to the Sultanate of Oman.
The most notable development in the history of the Omani Rial happens in 1970. At this time, Sultan Qaboos bin Said assumed power after overthrowing and exiling his father Sultan Said bin Taimur. The change in leadership followed a palace coup.
Qaboos bin Said after that embarked on a program of economic and social reform. His reforms included the establishment of a national currency and the establishment of the Central Bank of Oman in 1974. The central bank issues and manages the Omani rial.
The Sultan Qaboos bin Said chairs the Central Bank of Oman himself. He governs the bank along with six other board members. In 2017, Tahir Bin Salim Al Amri became the central bank’s executive president. He replaced Hamud Sangur Al Zadjali, who served in the post since 1991.