The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.
Foreign Exchange

European corporates blindsided by FX volatility

Volatility in Q3 led to losses for Europe’s multinationals, report shows.

A large number of European multinational corporations have seen their profitability take a hit as a result of a recent surge in volatility in the foreign-exchange market, according to a report from risk-management technology provider FiREapps.

During the third quarter of 2017, 54 out of 350 Europe-based companies reported a negative impact on their earnings as a result of currency moves.

Of those, 26 quantified their impact, accounting for a collective loss of €3.63 billion ($4.27 billion). This was a sharp increase on previous quarters, with similar losses not seen since 2015.

Wolfgang Koester-160x186

Wolfgang Koester,
FiREapps

“FX tends to be quite cyclical in that volatility comes and goes in particular currency pairs,” says Wolfgang Koester, chief executive of FiREapps. “When markets are quiet, companies do hedge less and then when they get hurt they suddenly want to increase hedge ratios.

Take out a complimentary trial

Take out a 7 day trial to gain unlimited access to Euromoney.com and Asiamoney.com analysis and receive expertly-curated updates direct to your inbox.

 

Already a user?

Login now

 

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree