Depreciation
in sentence
495 examples of Depreciation in a sentence
Given this, the likely upshot of monetary tightening in the advanced economies will be a long
depreciation
of emerging-market currencies and, in turn, a significant interest-rate hike – a trend that puts emerging economies at risk for the kinds of credit crises that have bedeviled developed economies over the last six years.
Deficit hawks worry that at some point global investors will lose their enthusiasm for holding ever-greater amounts of US debt, resulting in a sharp
depreciation
of the dollar.
Just as QE’s introduction fueled currency appreciation, announcing its eventual end triggered
depreciation.
Many economists outside of China have argued that the December
depreciation
resulted from betting by investors that Chinese policymakers, facing the prospect of a hard landing for the economy, would slow or halt currency appreciation.
The dollar shortage created
depreciation
pressures on the CNY, which the PBoC declined to offset.
Death by RenminbiWASHINGTON, DC – Over the last several weeks, the dollar’s
depreciation
against the euro and yen has grabbed global attention.
But, in a world where China links its currency to the dollar at an under-valued parity, the dollar’s
depreciation
risks major global economic damage that will further complicate recovery from the current worldwide recession.
China’s currency policy means that dollar depreciation, rather than improving America’s trade balance and stanching its leakage of jobs and investment, may inadvertently spread these problems to the rest of the world.
With China retaining its under-valued currency policy, dollar
depreciation
can aggravate global deflationary forces.
Some argue that exchange-rate
depreciation
will narrow the trade deficit by making British exports more competitive, but the experience of 2008, when the pound also fell sharply, is that the impact on the external deficit may not be great.
When governments try to attract investment with subsidies, tax holidays, special exemptions, and accelerated
depreciation
schedules, they create distortions that undermine comparative advantage.
But if the country’s borrowers have a lot of dollar-denominated debt,
depreciation
can be ruinous.
Currency
depreciation
is not a feasible option for all advanced economies: they all need a weaker currency and better trade balance to restore growth, but they all cannot have it at the same time.
“[H]eightened and prolonged uncertainty,” owing to the impending referendum, “has the potential to increase the risk premia investors require on a wider range of UK assets, which could lead to a further
depreciation
of sterling and affect the cost and availability of financing for a broad range of UK borrowers.”
Central Banks in countries facing a run on their currencies may also decide to allow a
depreciation
and let the markets chart the exchange rate’s course, rather than trying to “defend” some predetermined parity.
If capital is flowing out of Italy and into Germany, there is no scope for an Italian depreciation, as would have occurred prior to the common currency.
If interest rate hikes,
depreciation
or devaluation of the currency, and controls on financial outflows are not viable options, what can a country’s central bank do when faced with accelerating capital flight?
So why has it been singing the
depreciation
song?
The traditional remedy for countries caught in the kind of crisis that Spain, Greece, Portugal, and Ireland find themselves in is to combine fiscal retrenchment with currency
depreciation.
But eurozone membership deprives these countries of this powerful tool, and
depreciation
of the euro itself is of limited benefit since so much of their trade (around 50%) is with Germany and other eurozone members.
Immediate currency
depreciation
should help reduce large external deficits while at the same time providing room for growth without adding to the craving for external financing.
In the current setting, the exchange market strategy should be: an immediate
depreciation
of 10% combined with the transition to a BBC regime.
Transition to a transparent currency regime creates confidence that Korea is not embarking on a cycle of
depreciation.
Of course,
depreciation
and lower rates will foster both growth and some increase in inflation.
Although cutting the Federal Funds interest rate from 5.25% in the summer of 2007 to 3% now contributes to dollar depreciation, this has been aimed at stimulating a weakening economy.
A 20% dollar
depreciation
would therefore reduce Americans’ purchasing power by only 3%.
Already, most export taxes and currency controls have been scrapped, income taxes have been cut, and the exchange rate has been freed up, allowing for an immediate 30%
depreciation
of the peso.
The European Monetary System began as a high-level reaction to global currency chaos, and in particular to the
depreciation
of the dollar in 1977 and 1978, which seemed to threaten its continued role as the major international reserve currency.
Why Russia’s Economy Will Not CollapseGENEVA – The rapid
depreciation
of the ruble, despite a dramatic – and seemingly desperate – late-night interest-rate hike by the Central Bank of Russia (CBR) last month, has raised the specter of Russia’s economic meltdown in 1998.
The ruble’s
depreciation
is bound to fuel inflation, already around 11% and far above the CBR’s 5% target.
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