Currency depreciation is the decline in the value of one currency in relation to another. It specifically refers to currencies with a floating exchange rate, which is a system in which the value of a currency is determined by the forex market based on supply and demand.

Currency appreciation is the inverse of currency depreciation, in which a currency gains strength. Forex traders can profit from both appreciation and depreciation by taking a long or short position based on their market forecast.

Currency depreciation refers to a decline in the value of a nation's currency in relation to other currencies in the foreign exchange market. It is typically caused by factors such as economic downturns, inflationary pressures, or changes in investor sentiment. When a currency depreciates, it requires more units of that currency to purchase goods and services from other countries. While a depreciating currency can boost exports by making them more affordable to foreign buyers, it can also lead to higher import costs, inflation, and reduced purchasing power for consumers. Central banks often intervene to stabilize currency values and mitigate economic repercussions.