DZD - Algerian Dinar

Overview of the Algerian Dinar (DZD)

Algeria, also known as the People's Democratic Republic of Algeria, is a country located in the North African region, the largest country in Africa by area, and ranks 10th in the world by land area. This is also a country that belongs to the high middle-income group, comparable to many emerging powers in the world such as China, Brazil, or Turkey.

The Algerian Dinar, often referred to as DA, is the official currency of the country with the symbol DZD. 1 Dinar is divided into 100 cents; however, due to its low value, cents are no longer widely used in daily transactions. 

The circulating denominations of the Algerian Dinar include 5, 10, 20, 50, and 100 dinars. Due to significant inflation along with the economic transition to capitalism in the early 1990s, the penny coin in Algeria has depreciated and is rarely used in daily transactions. However, prices are still quoted in cents in daily transactions.

Higher-denomination banknotes are still more commonly circulated, with the currently circulating Algerian Dinar banknotes being 100, 200, 500, and 1000 dinars.

History of the Algerian Dinar (DZD)

• Before the country gained its independence in 1962, the Algerian franc was used.

• After the country gained its independence in 1964, the Algerian Dinar was introduced, initially valued at 1 dinar = 1 French franc.

• In 1994, the dinar depreciated and a floating exchange rate system was implemented.

• In 1998, the exchange rate of the Dinar against the US dollar was 58 dinars = 1 US dollar. 

The Algerian Dinar (DZD) Denominations

Currently, the Algerian Dinar is in circulation with the following main denominations, including both coins and banknotes:

• Denominations of banknotes: 5, 10, 20, 50, 100, 200, 500, 1000, 2000 Algerian Dinar.

• Coin denominations: 1, 2, 5, 10, 20, 25, 50, 1, 2, 5, 10, 20, 50, 100, 200 Algerian Dinar.

The Algerian Dinar’s exchange rate

The Algerian Dinar is subject to a controlled floating exchange rate system. With this policy, the value of the Algerian Dinar depends on the supply and demand in the foreign exchange market, and the Central Bank of Algeria can intervene to ensure the stability of the currency exchange rate as well as the economic stability of Algeria.

History of the Algerian Dinar’s exchange rate

The Algerian Dinar (DZD) has gone through the following exchange rate history:

• Early period (1964–1980s): In 1962, Algeria gained independence. In 1964, the DZD was introduced and replaced the Franc. The fixed exchange rate against the French franc was 1:1.

• 1990s-present: With managed floating exchange rate, the central bank can intervene to ensure the stability of the Algerian Dinar.

In recent years, the Algerian Dinar has experienced fluctuations due to factors from the global market such as oil prices and the economic and political situation. The Central Bank of Algeria continuously adjusts its policies to cope with economic fluctuations and maintain political stability.

Factors affecting the value of the Algerian Dinar (DZD)

The Algerian Dinar is influenced by many factors, including economic and political ones such as:

• Global economic situation: The development of the global economy affects the value of the Dinar. When the economy is in recession, the value of the currency significantly decreases. At this time, the Central Bank must adjust monetary policy to ensure economic stability and increase the value of the Algerian dinar.

• Oil prices: Algeria is one of the major oil-producing countries, which is why fluctuations in global oil prices can significantly impact national income as well as the value of the Algerian Dinar.

• Inflation: A high inflation rate will reduce the purchasing power of the currency, thereby leading to a decrease in the real value of the Dinar.

• Monetary policy: The decisions of the Central Bank of Algeria regarding interest rates or money supply can also affect the value of the Dinar. The tight monetary policy of the Central Bank usually helps strengthen the value of the currency.

• International trade: The trade balance (exports and imports) in the country also has a significant impact on the value of the Algerian Dinar. In the case where exports increase more than imports, the value of the currency also rises.

• Political situation: Political stability and government policies can affect investor confidence and the value of the currency.

All of the above factors affect the value of the Algerian Dinar in the international market. To track the real-time exchange rate of the Algerian Dinar accurately, you can use the Gocuco currency converter tool to convert from the Dinar to other foreign currencies!