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Depreciation is when one currency becomes weak against another currency. Appreciation is when one currency becomes stronger than other currency. For example, imagine that current exchange rate is USD/EUR=1.42 and after some time it changed to USD/EUR=1.45, in that case US Dollar depreciated against Euro. If it changes to USD/EUR=1.38 in this case US Dollar appreciates against Euro.
What else can I help you with?
What are the reason for the depreciation of us dollars?
When the economy is shrinking, the dollar suffers. The dollar will lose its value and it will take more less foreign currency to equal a dollar.
What does foreign currency means?
Foreign currency is basically currency or denomination of another country. The term is mostly used in context with foreign exchange also known as forex. There are a number foreign echange specialists like Travelex India etc that do currency conversion.
How do you change foreign currency to local currency?
BIU
Is FOREX an online foreign exchange broker?
FOREX is an online foreign currency broker. They offer foreign currency trading online. It is like eTrade but instead of investing in stocks, you invest in currency.
What is online currency trading?
It is the act of buying foreign currency over the internet, through different companies. It is called forex, or foreign exchange market. It is any currency traded over the internet. essentially, it is the simultaneous trading of foreign currency.
Differences between currency depreciation and apreciation?
Devaluation and depreciation are often interchangeable, although there is a subtle difference. Devaluation refers to changing the value of a currency in a fixed exchange rate, while depreciation is decreasing the value in a floating exchange rate.
What is the currency appreciation?
The rise in value of a currency relative to other currencies and sometimes gold. There are many economic explanations for the movement (or appreciation and depreciation) of currencies relative to one another and to gold.
What is currency appreciation?
The rise in value of a currency relative to other currencies and sometimes gold. There are many economic explanations for the movement (or appreciation and depreciation) of currencies relative to one another and to gold.
What factors create a foreign exchange gain on a foreign currency transaction?
An appreciation in a foreign currency creates a foreign exchange gain when the foreign currency is to be received. A decrease in the value of foreign currency creates a foreign exchange gain when the foreign currency is to be paid. (Hoyle, Schaefer, Doupnik, 2009, pp. 328)
What is an antonym for depreciation?
Appreciation is an antonym for depreciation.
What is the impact on currency when there is foreign investment?
In my opinion when there is foreign investment, there will be more demand on the country which is invested. Therefore, its currency is appreciated. Besides, that would help to boost the economy, so the currency will go up.
What is meaning of depreciation and devaluation and appreciation and revaluation?
depreciation is due to international economic pressure i.e the supply and demand of a currrency whilst devaluation is done by the government of a certain country , when it decides to set its currency or give its currency a certain value against others.
Will appreciation effect the export industry?
Unavoidably yes, the export industry is depended upon country currency. If the currency is appreciated, the export industries will lose their benefit. For example, in 2007 UK export industries lost profit nearly 2.2 million Euro after the appreciation of Euro currency. Oh man is this clear!!! If you have more hesitations e-mail me at Billnove@sidu.com
What is the difference between currency depreciation and appreciation?
depreciation is the reduction in the value of an asset due to usage, passage of time, wear and tear, technological outdating or obsolescence, depletion, inadequacy, rot, rust, decay or other such factors. Appreciation is a term used in accounting relating to the increase in value of an asset.
Do higher interest rates lead to currency appreciation?
Yes, higher interest rates can lead to currency appreciation. When a country's interest rates are higher compared to other countries, it attracts foreign investors seeking higher returns on their investments. This increased demand for the country's currency can lead to its appreciation in value.
How exports and imports tend to influence the value of a currency?
Exports and imports significantly influence a currency's value through the balance of trade. When a country exports more than it imports, there is higher demand for its currency, which can lead to an appreciation of its value. Conversely, if imports exceed exports, there may be a surplus of the domestic currency in the foreign exchange market, leading to depreciation. Additionally, trade balances affect investor confidence, further impacting currency valuation.
Why is a depreciation of the nations currency not feasible to eliminate a deficit if the natons demand and supply curves of foreign exchange are inelastic?
A depreciation of the nation's currency is intended to make exports cheaper and imports more expensive, theoretically boosting demand for domestic goods and reducing the trade deficit. However, if the demand and supply curves for foreign exchange are inelastic, it means that changes in currency value have little effect on the quantity of foreign exchange demanded or supplied. Consequently, even with a weaker currency, the expected increase in exports and decrease in imports may not materialize, leaving the deficit unchanged. Thus, the effectiveness of currency depreciation in addressing the deficit is significantly diminished under inelastic conditions.
