What is the 'KWD (Kuwaiti Dinar)'

KWD (Kuwaiti Dinar) is the national currency of State of Kuwait. The dinar name derives from the Roman denarius. The KWD Subdivides into 1000 fils and is the world’s most valuable monetary unit.

Kuwait is a small nation located between Iraq and Saudi Arabia on the Persian Gulf.

BREAKING DOWN 'KWD (Kuwaiti Dinar)'

Introduction of the Kuwaiti dinar (KWD) in 1960 was as a replacement for the Gulf rupee. The Gulf rupee was a currency pegged at parity to the Indian rupee. Issued in 1959 by the Indian government, the Gulf rupee was for use outside of India, particularly in the Persian Gulf region. Like the Indian rupee, theGulf rupee pegged to the British pound sterling (GBP). 

In 1961, Kuwait gained independence from the United Kingdom with the end of treaties put in place after the defeat of the Ottoman Empire. Kuwaiti Currency Law created the Kuwaiti Currency Board with the purpose of establishing a Kuwaiti currency. The Kuwaiti Currency Board introduced Kuwaiti dinar as a replacement for the Gulf rupee. Until 1966, both currencies circulated, use of the rupee ended after its devaluation.

Between 1975 and 2003, the Kuwaiti dinar pegged to a weighted currency basket. The content of the currency basket is as per the mandate of the Kuwaiti Currency Board. However, in 2003, the KWD became pegged to the US dollar (USD) at precisely 0.29963 dinars to the dollar. This valuation continued until 2007 when it was formally re-pegged to a basket of currencies. 

The dinar earned the earmark of being the 4th most circulated currency on Earth, after the US dollar (USD), the Euro (EUR), and the Chinese yuan (CNY). As of December 2016, the Kuwaiti dinar was worth about USD 3.28, making it the most valuable money on Earth.

The State of Kuwait has a petroleum product-based economy which accounts for nearly half of the country's gross domestic product (GDP). The Kuwait Investment Authority (KIA) is the oldest sovereign wealth fund in the world, and the investment industry of the country manages more assets than any other member of the Gulf Cooperative Council (GCC), a regional economic and political union.

According to World Bank data, Kuwait experienced a negative annual growth in GDP of 2.9% for 2017, with a yearly inflation deflator of 11.9-percent.

Issuance of the Kuwaiti Dinar

There have been six official issues of the Kuwaiti dinar banknotes since the first circulation in 1960. There have also been two commemorative sets circulated. 

The third series, released in 1980 upon the crowning of Emir Jaber al-Ahmad al-Jaber al-Sabah, was in use until Iraq invaded Kuwait in 1990. Upon invasion, the Iraqi government installed the Iraqi dinar as the official currency for the area. The invading Iraqi forces stole an enormous number of Kuwaiti dinar banknotes. With the liberation of Kuwait, the invalidation of the third dinar issue forced the replacement with the fourth issue of the currency.

The most recent issue, the sixth came in 2014 will bills specially textured so blind and vision-impaired persons can identify them by touch.

RELATED TERMS
  1. IQD (Iraqi Dinar)

    IQD is the currency abbreviation for the Iraqi dinar, the currency ...
  2. JOD

    The currency abbreviation or currency symbol for the Jordanian ...
  3. JOD (Jordanian Dinar)

    The JOD (Jordanian Dinar) is the currency for Jordan with its ...
  4. LYD (Libyan Dinar)

    LYD is the abbreviation for Libya's currency, the Libyan dinar. ...
  5. TND (Tunisian Dinar)

    TND (Tunisian Dinar) is the national currency for the Republic ...
  6. Kuwait Investment Authority

    The Kuwait Investment Authority (KIA) is a government-owned corporation ...
Related Articles
  1. Trading

    The 6 Strongest Currencies Vs. The U.S. Dollar in 2016

    Learn about the world currencies that are stronger than the U.S. dollar, as of February 2016, as well as which factors have contributed to the dollar's strength.
  2. Trading

    What Would Have To Happen For The Iraqi Dinar To Become A Stable Investment?

    What factors would cause price changes in the controversial Iraqi dinar?
  3. Trading

    Forex Exotic Currency Trading: Risks & Rewards

    Exotic currencies are off the beaten path and are not for novices, but experienced forex investors might find the high risk-reward potential exciting.
  4. Trading

    Crude Oil Has 20% Upside Potential in Rupees

    After pulling back to support levels, crude oil prices in rupees could be poised for 20% gains.
  5. Investing

    The Pros and Cons of a Fully Convertible Rupee

    A look at some of the factors involved in a fully convertible rupee as India gains economic power and broadens foreign investment collaboration.
  6. Financial Advisor

    The Biggest Oil Producers in the Middle East

    Discover which countries produce the most oil in the Middle East, a region long known for its influence on international petroleum markets.
  7. Investing

    5 Most Oil-Dependent Economies in the World

    While gas prices below $2 a gallon have benefited American businesses and consumers, countries around the world are feeling the burn of the historically low prices, largely because they don't ...
  8. Investing

    The Biggest Private Oil Companies in the World

    Discover the largest private oil companies in the world, as ranked according to the average barrels of oil per day (B/D) that they produce.
  9. Trading

    NIFTY Small-Cap Stocks to Buy

    While the outlook is mixed for stocks on the NIFTY Smallcap 100 Index, we highlight some names that could be poised for gains.
  10. Trading

    The Origins Of Common Currency Symbols

    Check out some of the world's most heavily traded currencies and their origins.
RELATED FAQS
  1. Is there a world currency? If so, what is it?

    There is no such thing as a world currency. However, since World War II, the dominant or reserve currency of the world has ... Read Answer >>
  2. When and why did the euro make its debut as a currency?

    On January 1, 1999, the European Union introduced its new currency, the euro. Learn more about its history. Read Answer >>
  3. What is foreign exchange?

    Foreign exchange is the conversion of a country's currency into another. In a free economy, a country's currency is valued ... Read Answer >>
Trading Center