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What is the difference between a depreciation of the dollar and a devaluation of the dollar?

What is the difference between a depreciation of the dollar and a devaluation of the dollar?

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Answer #1

Depreciation of a dollar and the devaluation of dollar conceptually means the same.

That is, they refer to the fall in the value of a currency with respect to another currency in terms of its exchange rates.

The main difference between them lies in the fact that, a depreciation of dollar occurs naturally due to the changes in demand and supply side factors.

While the devaluation of currency refers to the deliberate attempt by a country or the government to decrease the value of a currency to make imports more expensive and exports cheaper.

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