Devaluation is the deliberate reduction in the value of a country’s currency relative to other currencies. This is typically done by a government or central bank in response to economic or political factors, such as a persistent trade deficit, a decline in foreign investment, or a need to stimulate exports. Devaluation can make a country’s exports more competitive by making them cheaper for buyers in other countries, while making imports more expensive for domestic consumers. However, devaluation can also lead to inflation and other economic problems if it is not managed carefully.