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By creating volatility in foreign exchange (FX) markets, U.S. tariffs are damaging North American corporates’ international competitiveness. In its latest currency volatility report, MillTech reports that more than four-fifths (83%) of companies in the U.S. and Canada have experienced losses this year due to unhedged FX risk. And 69 percent have seen their profitability or competitiveness in international markets decline as a result of “currency fluctuations, potentially influenced by trade tensions and tariffs”—with 35 percent describing the drop as “very significant.”
The 250 finance decision-makers MillTech surveyed are worried about tariffs’ impact on currency values (36%). They’re concerned that the high levels of uncertainty which tariffs are generating are preventing major decisions from being made (34%). And they fear that the new import duties have increased the counterparty risk their organization faces in hedging transactions (33%). Eighty percent of treasurers, and 41 percent of all respondents from the largest companies, are concerned about tariffs’ impact on currency values.
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Notably, not one respondent has no concerns about the impact of tariffs on their business. Eighty-seven percent said their organization has already changed its sourcing or manufacturing strategies in ways that impact its currency transactions. Thirty-five percent have already “significantly altered [their] supply chain.”
Most organizations are also adjusting their hedging strategies as a result of tariffs: Even though hedging costs have increased for 94 percent of respondents, 91 percent said their company currently hedges at least part of its FX risk, up from 82 percent last year and 81 percent in 2023. In addition, 64 percent of respondents are planning to increase hedge lengths to manage tariff-driven volatility and 32 percent expect to grow their hedge ratio.
“Many corporate CFOs have traditionally treated FX like a duck in the corner of the room,” says Eric Huttman, CEO of MillTech. “They pay it little attention until it starts quacking loudly. In 2025, that quacking is impossible to ignore. North American businesses are facing an increasingly volatile landscape, with currency shocks and trade disruptions affecting their competitiveness and profitability.
“For too long, currency risk has been treated as a background issue, quietly managed by treasury teams while broader business priorities took center stage,” he continues. “But in an era where currency swings can erase quarterly gains, proactive FX risk management is essential. Businesses can no longer afford to ignore the duck. It’s time to listen, prepare, and build smarter, more resilient FX strategies.”
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