What is Revaluation?

Revaluation Definition. Revaluation typically means an upward adjustment in the value or price for goods, products or services. It is more commonly applied to revaluing a specific currency that is not floating freely in the forex market. In this case the respective central bank may elect to modify the pegging mechanism (or benchmark used whether another currency or basket of currencies or wage rates or the price of Gold) that is used when international trade settlements are consummated. A floating exchange rate that rises, thus revaluing, is said to appreciate. The opposite process to revaluation is known as devaluation. Redenomination, however, is not related to either of these two processes. It involves changing the face value of a currency without changing its foreign exchange rate. The Chinese government has resisted global efforts to revalue its currency, although it has modified its pegging system and controlled the revaluation process to allow for minimal changes from time to time. Officials do not wish to discourage demand for its exports until a transition to a more consumer driven economy can be accommodated.

Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.