bkballa

US exporter exported his goods to another country.
He expects to be paid with a foreign currency.
expects say 100$ in today's exchange rates of 1.5 PIF/$. So receiver of goods would spend 150 PIF.

Now say PIF instead becomes 1.2 PIF/$ (PIF appreciated, $ depreciated). To pay the US Exporter 100$ now receiver of goods needs to spend only 120 PIF. So the Receiver (Counterparty) benefits because the US$ depreciated/PIF appreciated.

CP