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Nearby Terms

devaluation

definition

A significant decline in the value of a unit of currency relative to a baseline such as gold or another currency unit. For example, if the foreign exchange rate for the Japanese Yen were to drop substantially relative to the U.S. Dollar (meaning that it takes more Yen to buy one U.S. Dollar), it could be said that the Yen has been devalued.

Related Terms

 • capital flight  • J-curve  • redenomination  • competitive devaluation  • readjustment  • panic  • readjust  • currency certificate