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Definition of devaluation
1 : an official reduction in the exchange value of a currency by a lowering of its gold equivalency or its value relative to another currency
2 : a lessening especially of status or stature : decline
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Recent Examples of devaluation from the Web
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If so many people can come forward and still be disbelieved, the devaluation of women’s voices is clear.
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Bad family business ideas, and especially the devaluations, ended the harmony.
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The recession sparked a Russian ruble devaluation, and many Russians were hit hard by the currency shakeup.
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Like Aaron Brill, the owner of southern Colorado’s Silverton Mountain, a longtime, vocal critic of the Epic Pass’ devaluation of day lift ticket prices.
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The idea is that by creating a market for some types of investment transactions, policy makers can satisfy calls to float the currency without risking an inflationary spiral that may come from a formal devaluation.
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The two running backs who skipped bowl games, Leonard Fournette and Christian McCaffrey, understandably saw no devaluation of their draft stock as they were drafted fourth and eighth overall.
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In the second quarter of 2015, the company took a $720 million charge for currency devaluation and asset valuation write-downs as the economy faltered.
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Safwat’s winnings of £15,000, despite its devaluation, is his best at one event on tour.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'devaluation'. Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
First Known Use of devaluation
1914
Financial Definition of DEVALUATION
devaluation
What It Is
Devaluation refers to a decrease in a currency's value with respect to other currencies.
How It Works
A currency is considered devalued when it loses value relative to other currencies in the foreign exchange market. A currency's devaluation is the result of a nation's monetary policy.
A central bank can make the conscious effort to make its currency less valuable. If Country XYZ's currency is set at a fixed exchange rate of 2:1 to the U.S. dollar and, due to a weak economy, XYZ cannot afford to pay the interest rate on its debt outstanding, XYZ may devalue their currency. This means the central bank of XYZ will declare their fixed exchange rate to be 10:1 to the U.S. dollar. This makes their debt outstanding is now worth five times less. It's a very tricky maneuver with grave economic consequences.
Why It Matters
Whether deliberate or as a result of market climate, currency devaluation reduces the price of a country's domestic output. This has the potential to benefit the economy by helping to increase its export volume. Conversely, import volumes become stifled as the price of foreign-produced goods and services increases dramatically.
The opposite of devaluation is known as revaluation.
For a more thorough explanation of currency devaluation, how China manipulates its currency worth and the economic impact following Argentina's devaluation, please read this educational article: How Money Manipulation on the Other Side of the World Could Affect American Portfolios
Law Dictionary
devaluation
playLegal Definition of devaluation
1 : an official reduction in the exchange value of a currency by a lowering of its gold equivalency or its value relative to another currency
2 : a lessening of the value of something (as an asset) portfolio devaluation
Learn More about devaluation
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See words that rhyme with devaluation Spanish Central: Translation of devaluation Nglish: Translation of devaluation for Spanish speakers Britannica.com: Encyclopedia article about devaluation
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