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Trendspotting: FX

Part 1: Complacency emerges as a significant risk in Kyriba’s latest “Currency Impact Report.”

By T&R Staff | April 21, 2022 at 02:53 PM
Stock illustration: Taking a big-picture view across gears

Kyriba’s latest “Currency Impact Report” estimates that North American companies experienced $9.32 billion in currency tailwinds late last year. The study is based on an analysis of Q3/2021 earnings calls by 1,200 large multinationals that operate outside the financial services sector. (Note that Kyriba’s next “Currency Impact Report” comes out next month.)

In the current study, one-third of North American companies reported that shifts in the value of the Canadian dollar affected their financials, while just over a quarter identified the euro as impactful. The vast majority of these organizations felt positive effects from the changes to foreign exchange (FX) rates—i.e., “tailwinds.” And among companies experiencing tailwinds, the FX swings improved earnings per share (EPS) by 4 cents on average.

This remarkable finding was a boon to these businesses’ bottom lines. But is that a good thing—and can it last? To answer these questions, Treasury & Risk sat down with Kyriba’s chief evangelist, Wolfgang Koester, who has been a driving force behind the quarterly “Currency Impact Reports” for more than a decade.

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