Pay off high-rate debt with a personal loan and save thousands. Learn more.

How Much Is a Dollar Worth Around the World?

By Rebecca Lake · September 18, 2023 · 8 minute read

We’re here to help! First and foremost, SoFi Learn strives to be a beneficial resource to you as you navigate your financial journey. Read more We develop content that covers a variety of financial topics. Sometimes, that content may include information about products, features, or services that SoFi does not provide. We aim to break down complicated concepts, loop you in on the latest trends, and keep you up-to-date on the stuff you can use to help get your money right. Read less

How Much Is a Dollar Worth Around the World?

Exchanging one currency for another is something you may need to do if you’re traveling internationally. Depending on your choice of destination, your money may go further in some countries than others if you’re able to take advantage of favorable exchange rates.

How much is a dollar worth outside of the U.S.? To answer that question, it helps to understand how exchange rates work and the various factors that influence currency values.

Check your score with SoFi

Track your credit score for free. Sign up and get $10.*


Types of Exchange Rates

An exchange rate is the rate at which you can exchange one currency for another. Currency exchange rates are influenced by a number of factors, including the state of the economy in a particular country, interest rates, and unemployment rates. There are generally three types of exchange rate systems that can determine the value of currency.

•   Free-floating. In a free-floating or flexible exchange rate system, currency values are determined by supply and demand. Federal governments and central banks don’t participate in the system, since it’s self-regulating. The United States is the closest example of what a free-floating exchange system looks like in action.

•   Fixed exchange. Fixed or pegged exchange rate systems rely on the government to set exchange rates between different currencies. In this system, the weaker currency is fixed, or pegged, to the stronger one. A fixed exchange encourages stability in currency values, but it can leave governments with less room to maneuver if economic disruption occurs.

•   Managed float. Managed float exchange systems combine some of the features of free-floating and fixed exchanges. In this type of arrangement, central banks play an active role in the buying and selling of foreign currencies.

Understanding currency exchange rates is important for determining the purchasing power of a dollar. A currency’s foreign exchange rate reflects its price, while its value determines how much purchasing power it holds. In other words, currency values dictate just how far your money goes.


💡 Quick Tip: When you have questions about what you can and can’t afford, a spending tracker app can show you the answer. With no guilt trip or hourly fee.

Exchange Rate Calculation

Calculating currency exchange rates is a fairly straightforward process. You’ll take the starting amount of currency that you have and divide it by the amount of currency you’d end up with if you exchanged it. Here’s what the formula looks like:

Original currency amount / Ending currency amount = Exchange rate

For example, say that you’re planning a trip to Europe and you want to know what the exchange rate is from USD to Euros. If you were to exchange $100 in U.S. currency and get 90 euros in exchange, your exchange rate would be 1.11.

$100 USD / $90 EUR = 1.11

You can also do the calculation in reverse, dividing your current currency by the exchange rate instead. That would tell you how much money you could expect to get when exchanging currency for a different one. If you’re curious about what a country’s exchange rate is while you’re traveling, that information is usually readily available at banks, airports, or currency exchange shops.

Factors That Affect Currency Value

As mentioned, currency value is how much purchasing power your money has. There are numerous factors that can influence a currency’s value and how much it fluctuates over time.

•   Inflation. Inflation refers to price increases for consumer goods and services over time. When inflation rises, purchasing power decreases. Knowing how to find the inflation rate and what’s considered normal can help with gauging currency values at a given point in time.

•   Interest rates. Governments can use interest rate policy to direct the economy and monetary policy. When a government raises rates, that can increase its currency’s value, as foreign investors may be attracted to the higher rates their money can earn on deposit at banks. Compounding interest at consistently higher rates directly correlates to the time value of money.

•   Gross domestic product (GDP). Economic indicators, including gross domestic product, can influence currency values. The stronger a country’s economy is perceived to be, the more value its currency may hold.

•   Unemployment rates. Unemployment rates are another economic indicator that can sway currency values higher or lower. When unemployment is low, that can be a sign of a solid economy, while higher unemployment rates may suggest a weaker or weakening economy.

•   Government debt. How government debts are managed can also impact currency values. If a government is struggling to pay its financial obligations, that could cause a drop in currency values, especially if the government decides to print more money to cover its debt obligations.

•   Political climate. The political conditions of a country matter when determining currency values. Countries that are politically stable are less likely to see huge fluctuations in currency values compared to ones that are going through significant upheavals or periods of civil unrest.

Understanding what affects currency values is important if you’re saving or investing and keeping some of your assets in cash. Specifically, it matters as it relates to the store of value.

What is store of value? In simple terms, it’s an asset that holds its value well over time. Gold and other precious metals are examples of potential stores of value, as they tend to be more insulated against negative economic events that could affect what currencies are worth.

Stocks can also be potential stores of value, though it’s important to consider risk and what you’ll pay for them. Dollar-based investing can make it easier to invest in stocks in smaller increments if you’re worried about losing value. Learning how dollar-based investing works can help you to decide if it might be right for you.

Cash, meanwhile, is usually considered a poor store of value as it can quickly lose purchasing power when currency values drop. Curious about how inflation might be affecting your personal spending power? Using an hourly wage inflation calculator can give you insight into just how much your paychecks are worth over time.

Recommended: How to Calculate Stock Profit

Countries Where the US Dollar Is Strong

When the U.S. dollar is strong, it means that it’s rising in value compared to other currencies. A strong dollar can be used to buy more foreign currency. That’s a good thing if you’re traveling and want to get the most value for your dollars when exchanging for local currency.

Here are some of the countries where the U.S. dollar is strongest as of August 21, 2023.

•   Peru: 1 USD = 3.72 Peruvian sol

•   Mexico: 1 USD = 17.04 Mexican peso

•   Japan: 1 USD = 146.39 Japanese yen

•   Egypt: 1 USD = 30.90 Egyptian pound

•   Chile: 1 USD = 869.25 Chilean peso

•   Argentina: 1 USD = 350.02 Argentine peso

•   Colombia: 1 USD = 4,063.33 Colombian peso

•   Russia: 1 USD = 93.75 Russian ruble

•   Philippines: 1 USD = 56.46 Philippine peso

•   Cuba: 1 USD = 23.98 Cuban peso

From an investment perspective, holding foreign currency debts when the dollar is strong can be a positive thing. If the value of your home country’s currency increases while the debt’s currency value declines, that can increase overall net worth.

Recommended: What Is My Liquid Net Worth?

Countries Where the US Dollar Is Weak

When the U.S. dollar is weak, it means that its value is in decline in comparison to other currencies. So if you’re exchanging U.S. dollars for a stronger foreign currency you won’t have as much purchasing power.

In terms of countries where the dollar is weakest, the list generally includes any countries that use the euro. The current exchange rate from U.S. dollars to euros is 1 USD = 0.92 EUR. Countries that use the euro include:

•   Austria

•   Belgium

•   Croatia

•   Cyprus

•   Estonia

•   Finland

•   France

•   Germany

•   Greece

•   Ireland

•   Italy

•   Latvia

•   Lituania

•   Luxembourg

•   Malta

•   Netherlands

•   Portugal

•   Slovakia

•   Slovenia

•   Spain

If you’re planning to travel to any of these countries, it’s important to know the current exchange rate and what you’ll pay in currency conversion fees to trade out your dollars for euros.


💡 Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

The Takeaway

Knowing how much a dollar is worth in different locations can help you to plan your next vacation. You might also be interested in currency exchange rates if you’re interested in trading foreign currencies as part of your investment strategy. Whether you’re spending money at home or abroad, it’s important to keep track of where your cash is going.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

With SoFi’s money tracker app, you can keep tabs on how your money comes and goes.

FAQ

What country is a dollar worth most?

Some of the countries where a dollar is worth the most money include Mexico, Peru, Chile, and Colombia. It’s possible to exchange dollars for local currency in these countries at favorable exchange rates.

Is the US dollar worth the most in the world?

The U.S. dollar is the world’s reserve currency and is the most widely used currency for global trade. That does not mean, however, that it’s the world’s top currency in terms of value. Other currencies may surpass the value of the U.S. dollar depending on economic conditions and the supply-demand environment in the foreign exchange market.

How much is $1 in Mexico right now?

How much is a dollar worth in pesos? It depends on which country you’re in, as several countries have their own version of the peso. If you’re specifically asking how much is a dollar worth in Mexico, $1 will get you 17.04 Mexican pesos as of August 21, 2023.


Photo credit: iStock/Foremniakowski

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SORL0823001

All your finances.
All in one app.

SoFi QR code, Download now, scan this with your phone’s camera

All your finances.
All in one app.

App Store rating

SoFi iOS App, Download on the App Store
SoFi Android App, Get it on Google Play

TLS 1.2 Encrypted
Equal Housing Lender