soft currency

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Related to Currency Weakening: Strong Currency

Soft currency

The money of a country that is expected to drop in value relative to other currencies.

Soft Currency

A currency that fluctuates in value frequently. Soft currencies are generally issued by governments that are less stable and/or have weaker economies than stronger currencies. As such, most soft currencies come from countries in the developing world. Central banks rarely hold reserves of foreign soft currencies as they do little or nothing to stabilize the local currency. A soft currency is also called a weak currency. See also: Strong currency.

soft currency

a FOREIGN CURRENCY that is in weak demand, but in abundant supply on the FOREIGN EXCHANGE MARKET. This situation usually arises when a country is in persistent balance-of-payments deficit. Compare HARD CURRENCY.

soft currency

a FOREIGN CURRENCY that is in weak demand but in abundant supply on the FOREIGN EXCHANGE MARKET. Soft currency status is usually associated with an economically weak country that is running a large deficit in its BALANCE OF PAYMENTS; the supply of the currency is high to finance the purchase of imports, but demand for the currency is relatively weak because the amount of it being required for the purchase of exports is much lower. Under a FLOATING EXCHANGE RATE SYSTEM, however, the demand for, and supply of, the currency should be, in theory, brought into balance by a DEPRECIATION 1 in its EXCHANGE-RATE value. Compare HARD CURRENCY.
References in periodicals archive ?
The company warned that growth in emerging markets continues to slow as a result of significant currency weakening.
The bank is worried about the currency weakening further as it would push up the cost of imports, drive up already stubbornly high consumer price inflation and risk a widening of the current account deficit, which hit a record 4.
Remittances, especially big-ticket transactions, where people send money for investments or savings, are on the rise, which is a natural outcome of currency weakening, said Shetty.
The reason for American national currency weakening was the G20 session.
currency has moved conversely with crude oil prices, with the currency weakening at times of rising oil prices.
politicians seek currency weakening in order to win votes in manufacturing states, then they will hesitate to invest.
In fact, Luanda claim on the top spot comes "despite its currency weakening against the US dollar".