How does a country’s currency devalue

Question

How does a country’s currency devalue

In: 2

Answer 1

People don’t want it.

So currency, including all the bitcoins and such out there, are based on people’s perception of their value in relation to other things. In that sense it’s really just an extension to bartering when they exchanged goods for other goods.

You can buy currency to spend or on sell and trading in the currency can show demand in it since people need to get the currency in order to buy with it.

If no-one wants the currency or everyone is demanding more of the currency to exchange goods, that means it is worth less because you have to give more of it to get what you want.

Answer 2

People don’t want it.

So currency, including all the bitcoins and such out there, are based on people’s perception of their value in relation to other things. In that sense it’s really just an extension to bartering when they exchanged goods for other goods.

You can buy currency to spend or on sell and trading in the currency can show demand in it since people need to get the currency in order to buy with it.

If no-one wants the currency or everyone is demanding more of the currency to exchange goods, that means it is worth less because you have to give more of it to get what you want.