Recent Examples of devaluation from the Web
The lack of female Nobelists sends a powerful message of devaluation to aspiring female STEM professionals.
Critics say Petro’s policies would cause inflation and a devaluation of the peso.
The rial experienced several waves of devaluation, including during the last ramp-up in U.S. sanctions.
Many Argentines still blame the IMF for permissive and heavy lending that led to devaluation of the peso and the debt default.
China may respond by selling U.S. Treasuries, currency devaluation, or seeking a rare earth ban.
The ruble lost half its value, and, despite a muted recovery in oil and a boost to industry from the devaluation, Russia’s economy is set to shrink by 2.7 percent this year, according to a World Bank report.
Tough tech stock market The other likely reason for the devaluation is simply that tech stocks are generally down this year.
That is the opposite of a currency devaluation game.
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.
Financial Definition of DEVALUATION
What It Is
Devaluation refers to a decrease in a currency's value with respect to other currencies.
How It Works
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
legal Definition of devaluation
- portfolio devaluation
Seen and Heard
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