Question

When a country experiences a depreciation of its currency, what does it imply on its economy

Answer 1

For the economy it reduces the country's export cost and trading

Step-by-step explanation:

Devaluation is the intentional attempt made by a country for downward adjustment of it's currency value.

The government issuing the currency decides to devalue it.when Devaluing a currency, it reduces the country's exports costs and can aid the shrinking tin deficits in trade

Also, the prices of goods produced locally decline relative to prices of international standard.

Answer 2

When a country experiences currency depreciation, it means that its domestic currency is losing value against a foreign currency.

The main consequence of this is that goods expressed in foreign currency become more expensive, which decreases imports.

The goods produced domestically become cheaper for people abroad, for this reason, currency depreciation can promote exports, and some countries have used currency depreciation to strengthen their countries' export sector.