Currency devaluation


Also found in: Dictionary, Thesaurus, Legal, Encyclopedia.

Currency devaluation

A deliberate downward adjustment in the official exchange rates established, or pegged, by a government against a specified standard, such as another currency or gold.

Devaluation

The active decision of a government to reduce the value of its own currency vis a vis other currencies. Devaluation occurs exclusively in fixed currencies, when the currency in question is pegged to another currency. Governments devalue their own currencies to make their exports less expensive in foreign markets. If a company exports its products for the same price in the local (devalued) currency, it is cheaper for consumers to buy those products in their own currency. See also: Depreciation.
References in periodicals archive ?
To find out more about the impact of currency devaluations on emerging stock markets, visit the DRI-WEFA Web site (http://www.
Even though some economists agree with the thinking behind Brazil's currency devaluation, they said it comes at a very bad time.
Due in large part to the start of the diversification described above and also as a result of the company's decision to reduce its receivables exposure due, in part, to anticipated currency devaluations in Argentina, Mexico, Venezuela and Paraguay, Ezcony has lowered its estimate for the fourth quarter revenues to between $25 to $28 million.
The province has suffered more than any other from neighboring Brazil's 1999 currency devaluation.
The currency devaluation in the region makes American goods more expensive to buy.
There is a variety of tangible and intangible factors to consider including transportation bottlenecks, counterfeiting of intellectual property, trade barriers, currency devaluation, and human resource issues.
Unable to hold their own against the foreign competition, Latin American carriers have relied increasingly on domestic routes, leaving themselves more vulnerable to currency devaluation and recession.
One was the economic slump in South-East Asia, which led to currency devaluation by a number of countries and cheaper exports of synthetic fibres.
The 1999 Brazilian currency devaluation, too, started to push more traffic to the Argentine port.
The majority of pharmaceuticals are supplied by the domestic industry, but it is heavily reliant on imported raw materials and increasing costs following the currency devaluation at the end of 1998 were eating into its margins.
Paulo Gaudenzi, Bahia's tourism secretary, says the increase is due more to recent efforts to revitalize the city than the effect of Brazil's currency devaluation.
While most companies are being hurt to varying degrees by the overseas currency devaluation, a few say they are either reaping or expect to see some benefits from the crisis that is shaking the economies of South Korea, Indonesia, Malaysia, Thailand and the Philippines to their roots.