what is a j curve 
a j curve is a trendline that shows an initial loss immediately followed by a dramatic gain in a chart this pattern of activity would follow the shape of a capital j the j curve effect is often cited in economics to illustrate the way that a country s balance of trade initially worsens following a devaluation of its currency then quickly recovers and finally surpasses its previous performance j curves are observed in other fields including medicine and political science in each case an initial loss is followed by a significant gain to a level that exceeds the starting point investopedia julie bangunderstanding the j curvethe j curve is useful to demonstrate the effects of an event or action over a set period of time put bluntly it shows that things are going to get worse before they get better in economics it is often used to observe the effects of a weaker currency on trade balances the pattern is as follows the devaluation of the nation s currency had an immediate negative effect because of an inevitable lag in satisfying greater demand for the country s products 