How is zakat calculated on foreign currency held for one year if its market price has fallen below its purchase price?

A decrease in the currency's value does not change its ruling as long as it reaches the nisab (85 grams of gold or 595 grams of silver), at which point zakat becomes obligatory. The basic principle is to pay zakat from the same type of wealth, but it is permissible to pay it with another currency based on its value at the time of payment.