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  • Chaoxiang Lee
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World's Safest Currencies

2015-05-08 12:02:12

In stocks, you still receive a dividend regardless of the current market situation. However, in foreign exchange, the safest options do not normally offer huge rewards. Let this article highlight the world’s safest currencies.



US Dollar



US dollar is the largest mystery to investors as of present. Prospects of interest rate hikes are high, and the quantitative easing is about to end. Being the global currency, it is safe to say this is a great bet. The greenback is currently bullish, which may last for a considerable time period. The Federal Reserve is known for bailing everyone out. But who can bail the US central bank out in case of trouble? Taxpayers, of course. Having said that, the United States is really good at looking for ways to secure victory.



Norwegian Krone and Singapore Dollar



Both are not major currencies, but are attractive in some ways.



Norwegian krone is a safe currency in a sense Norway has no net debt. This standalone currency is not in any way connected to another country’s mishaps. However, lower than expected economic data and declining home prices have been affecting the krone. Nevertheless, it remains a good long-term bet.



Krone’s fellow, the Singapore dollar, has shined because investors are attracted to the fact Singapore is the place to hide money for taxes. There may be opportunities, but the investment won’t be based on something attainable. Hence, do not consider it for now.



Gold



Merriam Webster states a currency is something in circulation as a medium of exchange. Therefore, gold is considered a currency. Attributes of gold include highly liquid, easily converted to almost any currency, and limited supply. Several people want to revert to the gold standard, but others stipulate this monetary system no longer works.



Between gold and the US dollar, the latter is more favored, which typically trades inversely to gold. And even if the stock market and/or economy tumbles, gold won’t prevail as all commodities are in a deflationary environment. And even before the creation of the Federal Reservation, gold sustained hefty losses. Therefore, gold may not be the best option for now. For the longest time, it has no significant upside potential.



There is no such thing as perfect currency. Among the four currencies, US dollar remains the safest currency in the world as it glides its way up, but its rivals, including the euro and the Japanese yen, are at high risk. Nevertheless, these currencies are worth every penny.