concepts
Devaluation occurs when a government or its central bank reduces the official price at which its currency can be bought on the foreign exchange (Forex) market. For example, suppose that the current $/£ exchange rate was 2:1, meaning that two USD had to be given up for each 1GBP or, equivalently, that 1GBP was worth 2 USD. If the GBP were devalued, this would mean that fewer USD had to be exchanged for each GBP, meaning that GBP had become cheaper in dollar terms. [Source: Encyclopedia of Business in Today's World; Devaluation]
devaluation
international monetary system