A decrease in a fixed exchange rate from $1.75 per pound to $1.60 per pound is called a ________ of the pound.

Question

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Devaluation is the term used to describe a decrease in a fixed exchange rate. As the exchange rate for the pound has decreased from $1.75 to $1.60, it is said to have been devalued. Depreciation is a similar term, but it is used to describe a decrease in the value of a currency in a floating exchange rate system. Appreciation refers to an increase in the value of a currency, and revaluation is a term used to describe a deliberate change in the exchange rate made by a country's government or central bank.

A Decrease in a Fixed Exchange Rate from $1