How do you determine currency appreciation?

Question

I am attempting to determine how much the american dollar appreciated compared to the Euro if the Euro was $1.20 and is now $1.18. Does anyone know the math I would use to answer his?

Answer 1

Assume that the Euro was $1.20 and is now $0.60: That means the U.S. dollar doubled in value: (1.20/0.60)-1 = 1, or 100%.

The math is the same for your question: (1.20/1.18)-1 =

0.016949153, or about 1.7%.

Hence, the American dollar appreciated 1.7% compared to the Euro.