Devaluation and revaluation impact on export and import competitiveness: theory and EU experience

Abstract

The impact of currency devaluation and revaluation on the state of trade balance is considered in the article. In particular, the directions and nature of the exchange rate policy impact on the competitiveness of export and import operations are investigated. The degree of exports and imports exchange rate elasticity is defined. The influence of revaluations and devaluations in one country on the state of the trade balance of other countries is characterized. The comparison of the benefits and risks of single European currency devaluation is conducted. The impact of euro devaluation on competitiveness of European exporters and importers is examined.