3 Answers

>>>Definition of Devaluation:
A devaluation is when a country makes a conscious decision to lower its exchange rate in a fixed or semi fixed exchange rate. Therefore, technically a devaluation is only possible if a country is a member of some fixed exchange rate policy.

For example in the late 1980s, the UK joined the Exchange Rate Mechanism ERM. Initially the value of the Pound was set between say 3DM and 3.2DM. However, if the government thought that was too high, they could make the decision to devalue and change the target exchange rate to 2.7DM and 2.9DM.

>>>Definition of depreciation: When there is a fall in the value of a currency in a floating exchange rate. This is not due to a government’s decision, but due to supply and demand side factors. Although if the government sold a lot of pounds they could help the depreciation.

For example, the dollar has depreciated in value against the Euro during the last 12 months. This is due to market forces, there is no fixed exchange rate target for Euro to Dollar.

The problem is that in every-day use, people talk about a devaluation in the dollar, when actually they, technically speaking, mean a depreciation in the dollar.>>FROM>>>http://www.economicshelp.org/blog/355/trade/devaluation-and-depreciation-definition/      

>>>Appreciation: is to raise the value of something, like currency.

>>>>Definition of 'Revaluation'

A calculated adjustment to a country's official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country's government (i.e. central bank) can alter the official value of the currency. Contrast to "devaluation".

Read more: http://www.investopedia.com/terms/r/revaluation.asp#ixzz2IkHyAxYk

 

 

11 years ago. Rating: 1
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Devaluation, 3. to 7, the stuffs that mexican buy sudenly duplicated their prices,  specially if they imported them from the united states, those who had debs in US dollars sudenly had their debs duplicated respecting to the mexican peso, but when the peso changed from 7 to 12, many people killed denselves   Think what happen in Argentina, when the peso was 1 to 1 in front of the dollar and then falled to 30 to 1, it falled 30 times in front of the dollar, so if bread cost u 1.20 pesos now it cost you 38 pesos...  (asuming the bread was imported)

11 years ago. Rating: 0
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Depreciation because Gave's in Mixico is changer 3.2$ to 5.5 $

11 years ago. Rating: 0
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