Question

According to recent media reports:
‘USA has accused China of currency devaluation to promote its exports’.
In the light of the given media report comment, how exports can be promoted through the Currency devaluation?

Answer 1

When currency devaluation takes place it signifies only one thing. In such a situation importing of prods from outside the country become very expensive.

The products manufactured within a nation, on the other hand, becomes very cheap for the world market to procure them.

So countries exporting a huge amount of goods can devalue their currencies so that they become lucrative for countries to import goods from them due to lowered prices.