Exchange rates

Exchange rate

The price of one currency expressed in terms of another.

Depreciation

When the exchange rate of a currency goes down, making it weaker.

Appreciation

When the exchange rate of a currency goes up, making it stronger.

Strong Pound

When the exchange rate of the pound increases, making it more valuable compared to other currencies.

Weak Pound

When the exchange rate of the pound decreases, making it less valuable compared to other currencies.

Exporters

Businesses that sell goods or services to foreign countries.

Importers

Businesses that buy goods or services from foreign countries.

Cheap Import

When the exchange rate of the pound depreciates, making imported goods cheaper for businesses.

Expensive Export

When the exchange rate of the pound appreciates, making exported goods more expensive for foreign countries.

Happy Importers

Importers benefit from a weaker pound as their costs decrease and they can reduce prices or make more profit.

Unhappy Importers

Importers are negatively affected by a stronger pound as their costs increase and they have to pay more for foreign currency.

Happy Exporters

Exporters benefit from a stronger pound as their goods become more expensive for foreign countries, making them more competitive.

Unhappy Exporters

Exporters are negatively affected by a weaker pound as their goods become cheaper for foreign countries, reducing their competitiveness.