Glossary

Revaluation
A revaluation is an upward adjustment on a country's currency relative to a baseline such as gold, wages, or a different currency. In a fixed exchange rate economy, a decision to revaluate a currency can only be made by the central bank. In a free-floating exchange rate, a revaluation is spurred by market forces. Revaluation is the opposite of devaluation, in which a country's currency experiences a downward value adjustment.
What causes revaluation?
In a free-floating exchange system, a revaluation of a currency can be caused by supply and demand issues, such as interest rate changes. It can also be caused by changes in the perceived economic stability of a country following an event such as a newly elected leader. In a fixed exchange rate system, a revaluation can only be triggered by the government, usually in response to market pressures.

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