Currency depreciation is good for exports because the prices of exported goods become more competitive, but it also causes the prices of imported goods to rise.

The depreciation of a currency means that the exchange rate of the country's currency has fallen. In other words, a certain amount of foreign currency can now buy more of the country's currency. From the perspective of international trade, the depreciation of the US dollar will give China's export products more price advantages, increase export revenue, and then increase the country's GDP. Therefore, currency depreciation is conducive to exports and will have a positive impact on the export trade economy. However, currency depreciation also inevitably leads to higher prices for imported goods, which may put economic pressure on importers. This kind of price increase usually affects the purchasing power of consumers in turn. The decline in people's purchasing power also has a negative impact on the economic development of the country. In addition, it should be noted that if a country adopts a policy of large-scale currency depreciation, it may trigger retaliatory measures from other countries, thereby expanding trade frictions. This approach is not an optimal strategy. Therefore, although currency devaluation is beneficial to exports, it also needs to strike a balance between the domestic market and international trade. At the same time, the reaction of the international market and the impact of other factors on the domestic economy should be taken into account.

What are the possible effects of currency devaluation in real life? Currency depreciation may cause the following effects: 1. Increase in the price of imported goods, leading to inflation and reducing consumer purchasing power. 2. The price of export commodities becomes more competitive, increasing export revenue and increasing the country’s GDP. 3. Reduce foreign investment confidence, which may lead to capital outflows. 4. Reflected in the exchange rate, resulting in exchange rate fluctuations. 5. Increase international trade uncertainty, leading to further trade frictions or even tariff wars. 6. Impact on debt, such as increase in foreign debt, etc.

The impact of currency depreciation relative to the domestic economy and international trade of other countries also needs to be considered. In actual situations, policymakers need to weigh the pros and cons of currency depreciation and take corresponding measures to balance stability. National economy and international trade.

Legal basis:

Article 53 of the "Foreign Trade Law of the People's Republic of China" The state promotes foreign trade through import and export credit, export credit insurance, export tax rebates and other trade and develop foreign trade.