Currency fluctuation

Currency Fluctuation

A change in an exchange rate. If the British pound is worth $2 on Monday, and $1.80 on Tuesday, a (somewhat dramatic) currency fluctuation has occurred. Currency fluctuations happen constantly and occur for all floating currencies.
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Currency fluctuation.

A currency has value, or worth, in relation to other currencies, and those values change constantly.

For example, if demand for a particular currency is high because investors want to invest in that country's stock market or buy exports, the price of its currency will increase. Just the opposite will happen if that country suffers an economic slowdown, or investors lose confidence in its markets.

While some currencies fluctuate freely against each other, such as the Japanese yen and the US dollar, others are pegged, or linked. They may be pegged to the value of another currency, such as the US dollar or the euro, or to a basket, or weighted average, of currencies.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
"The higher external debt for the month was principally due to the impact of local currency fluctuation against the dollar amounting to P42.42 billion and net availment of foreign loans amounting to P11 billion," the Treasury said.
KARACHI -- Cotton trading remained extremely slow due to fears of currency fluctuation.
Currency fluctuation causes concern for domestic industry
On a year-to-year basis, the price of a beach holiday can change substantially, taking into account factors such as currency fluctuation and inflation.
NEW DELHI -- The country's largest car maker Maruti Suzuki India has said it will increase the prices of its vehicles across all models by up to Rs 20,000 from January due to increasing pressure on its margins due to currency fluctuation.
India's largest car manufacturer Maruti Suzuki (MSIL) has announced a price hike across all its models from January in a bid to counter currency fluctuation and the increase in margins.
General Motors Co's Indian unit said on Thursday it will increase car prices in the country by 1-3 percent from January due to high input costs and currency fluctuation.
The card will retain the same value of the exchange rate at which it was purchased to protect customers from currency fluctuation. The card can be purchased online through the banks website and can be also reloaded online, the bank added.-TradeArabia News Service
P Balendran, General Motors India Vice President, said, 'The details, such as quantum of hike, are still being evaluated but we have decided to increase the prices of all our models from October 1 due to high input costs, currency fluctuation and freight costs.'
"All over the world there has been, particularly the emerging market economies, there has been a currency fluctuation. There has been Korea and certain countries also, I think Brazil, Mexico, there have also been currency fluctuations.
The company's ability to manage currency fluctuation risk and improvement in its overall financial risk profile are the key rating sensitivities along with continued government support for textile exports, CARE said.
Advice on how companies can use exports to help them through the downturn from currency fluctuation to credit insurance will be given at a seminar in Birmingham this week.