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Distinguish between devaluation and depreciation of …

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Distinguish between devaluation and depreciation of domestic currency.

Posted by Shweta Girdhar 7 years, 6 months ago

CBSE > Class 12 > Economics

1 answers

Devanshu Khokhar 7 years, 6 months ago

Devaluation of domestic currency means fall in value of domestic currency as planned by Central Bank,here exchange rate is not determined by market force.i.e. demand and supply. Whereas depreciation of domestic currency means fall in value by domestic currency in term of foreign currencies, under flexible exchange system determined by market force.i.e demand and supply.

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