Podcast series: a view from the FX dealing desk
04 February 2021
Listen to commentary from our FX experts on the currency markets.
null | 18 min podcast
17 Aug 2020
The crisis has prompted businesses to consider alternative ways of minimising foreign exchange risk.As we move through the crisis, we see more and more businesses who don’t have the same confidence in their revenue or cash flow forecasts due to the historic challenges they face. Consequently, in such circumstances, the traditional practice of using forward contracts to hedge foreign currency risk may not be appropriate. While forwards have typically allowed businesses to lock in rates to create better visibility around forecasting and protecting margins, there is little flexibility.
The approach to the dollar has been a relatively simple science from a currency perspective - if risk sentiment across the globe is deteriorating, the dollar will strengthen and vice versa. But we are now seeing increasing signs we can no longer rely on this dynamic.
Jonathan Pryor, Head of Corporate FX
‘Managing sterling and global currency risk volatility may never have been harder.’UK businesses looking out from their doorstep have realised that there is currently a lot beyond their current control – and managing sterling and global currency risk volatility may never have been harder.