Kuwaiti dinar

The dinar (Arabic: دينار, ISO 4217 code KWD) is the currency of Kuwait. It is sub-divided into 1000 fils. It is the highest-valued currency unit in the world.

History

The dinar was introduced in 1961 to replace the Gulf rupee. It was initially equivalent to one pound sterling. As the rupee was fixed at 1 shilling 6 pence, this resulted in a conversion rate of 13⅓ rupees to the dinar.

When Iraq invaded Kuwait in 1990, the Iraqi dinar replaced the Kuwaiti dinar as the currency and large quantities of banknotes were stolen by the invading forces. After liberation, the Kuwaiti dinar was restored as the country's currency and a new banknote series was introduced, allowing the previous notes, including those stolen, to be demonetized.

For a wider history surrounding currency in the region, see The History of British Currency in the Middle East.

Coins

The following coins were first introduced in 1961:

• 1 fils (No longer issued)
• 5 fils
• 10 fils
• 20 fils
• 50 fils
• 100 fils

Banknotes

To date five series of the Kuwaiti dinar banknote have been printed. The first series was issued following the pronouncement of the Kuwaiti Currency Law in 1960 which established the Kuwaiti Currency Board. This series was in circulation from 1 April 1961 to 1 February 1982 and consisted of denominations of ¼, ½, 1, 5 and 10 dinars.

After the creation of the Central Bank of Kuwait as a replacement to the Kuwaiti Currency Board, new ¼, ½ and 10 dinar notes were issued from 17 November 1970, followed by the new 1 and 5 dinar notes of the second series on 20 April 1971. This second series was likewise withdrawn on 1 February 1982.

The third series was issued on 20 February 1980, after the accession to the throne of Emir Jaber al-Ahmad al-Jaber al-Sabah, at that time in denominations of ¼, ½, 1, 5 and 10 dinar. A 20 dinar banknote was introduced on 9 February 1986. As a result of the state of emergency after Iraq's invasion of Kuwait, this series was ruled invalid with effect from 30 September 1991. Significant quantities of these notes were stolen by Iraqi forces and some have appeared on the international numismatic market. The "Standard Catalog of World Paper Money" (A. Pick, Krause Publications) lists notes with the following serial number prefix denominators as being among those stolen:

After the liberation, a fourth series was issued on 24 March 1991 with the aims of replacing the previous withdrawn series as quickly as possible and guaranteeing the country's swift economic recovery. This fourth series was legal tender until 16 February 1995. Denominations were ¼, ½, 1, 5, 10 and 20 dinar.

The fifth series of Kuwaiti banknotes has been in use since 3 April 1994 and include high-tech security measures which have now become standard for banknotes. Denominations were as in the fourth series.

Fixed exchange rate

From March 18, 1975 to January 4, 2003 the dinar was pegged to a weighted currency basket. From January 5, 2003 until May 20, 2007, the pegging was switched to 1 U.S. dollar = 0.29963 dinar with margins of ±3.5%.^[2] The central rate translates to approximately 1 dinar = 3.33745 dollars.

From June 16, 2007, the Kuwaiti dinar was re-pegged to a basket of currencies,^[3] and is now worth about US$3.609 (€2.686). It is the world's highest-valued currency unit.

See also

• Gulf rupee
• Cooperation Council for the Arab States of the Gulf
• Economy of Kuwait

References

External links

• Images of banknotes