The “Big Mac” index adopted by the “Economist” magazine to evaluate the currencies of countries showed that most of the world’s currencies are undervalued against the dollar, and the same applies to Arab currencies.
The “Economist” launched the “Big Mac” index in 1986, and it became a global standard and a way to measure the purchasing power of currencies in order to know whether they are below or above their true value.
The index is based on a comparison of the purchasing power of currencies in 48 countries, where the hamburger represents a unit that facilitates the comparison of the exchange rate of currencies against the dollar or its purchasing value.
The Economist indicated that the Lebanese pound is the most undervalued currency in the world, and considered that the Lebanese currency is undervalued by 70.2%, followed by the Russian ruble, which was considered undervalued by 59.9%.
The index also indicates that most currencies in the world are valued below their fair value against the dollar, with the exception of the Swiss franc, the Swedish and Norwegian krona, for example, the Swiss franc is overvalued by 24.7%.
Source – Russia Today