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International Trade vocabulary · Foreign Exchange

Depreciation

Meaning in international trade, with examples

/dɪˌpriːʃiˈeɪʃən/nounCommon term

In international trade, depreciation means: A fall in the value of a currency against other currencies, so that more of it is needed to buy the same amount of foreign money.

In Turkish: değer kaybı, değer düşüşü

How it is used

Used in market news and company reports: 'the depreciation of the lira against the euro'. Depreciation makes a country's exports cheaper abroad and its imports more expensive. The opposite is appreciation; an official cut in a fixed exchange rate is called devaluation.

Example sentences

  1. The depreciation of the local currency made our products more competitive abroad.

  2. Importers raised their prices after a 10 percent depreciation in three months.

Common collocations

  • currency depreciation
  • depreciation against the dollar
  • sharp depreciation
  • depreciation of the lira
  • exchange rateThe price of one currency expressed in another, for example how many Turkish lira you need to buy one euro.
  • currency riskThe risk that a change in exchange rates will reduce the value of money you will receive, or raise the cost of money you will pay, in another currency.
  • foreign currencyMoney in the currency of another country, such as US dollars or euros for a company based in Turkey.
  • hedgeTo reduce the risk of losing money from future price or exchange-rate changes, for example by fixing today the rate for a payment that will arrive later.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Foreign Exchange

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