New York (Reuters) – Corporate Treasures Efforts to keep the company’s earnings more than in the dollar (Dx = f) Strength, step that some analysts said that units added that President Donald Trump tariff plans would help keep the US currency longer.
The US dollar index in September is about 7% of the low lies near the two-year child in January, when investors were waiting for US economic growth and Trump’s trade policy.
Specificulators have loaded trucks for currency, increasing the position of a long dollar as much as $ 35 billion, the largest in almost nine years.
Corporate Treasures, which often use primary contracts, currency options and exchange to reduce possible currency losses, are usually moved at a more stable pace. But they get closer and closer to the view that the dollar can remain at this high level for a while.
“The corporate community is slowly operating and more intentional,” Paula, a phaule, is currently in the US Bank.
“(But) We have seen those who have a significant impact abroad, which they must repatrate, increasing these projected cash hedging programs,” he said.
“What we hear from customers is that they plan to make the dollar persistence,” said the surveys.
Image Photo. US dollar banknotes are seen in this illustration displayed in this illustration
Multinational companies like Apple (:Aapl) and Microsoft (Hook) Already warned that a strong dollar is facing the financial results of the pressure in the coming months.
Although there is little visibility at the gross level of corporate hedging activities, interviews with market participants show that the November elections and ahead of the victory and hit the protection against the force of high-level dollar.
“Guided by the elections, our research showed that North American companies were sharply aware of the risks of the elections with the nation,” Eric Houtman Milltechfx said.
“Half of these small companies said they were concerned about the impact of changes in foreign policy.” He said.
The vulnerability of this week’s foreign currency markets this week came the first week, as US tariff threats against Mexico, Canada and China prompted dollars and rising instability.
While the strong dollar reflects the reflection of the relative strength of the US economy, it can cause a problem for some companies. The strongest currency of the United States makes it more expensive for multinational companies to revive foreign profits to the dollar, while the competitiveness of exporters products also damage.
“We have seen strongly upon UPTICK, as corporate sought to protect themselves from a higher unstable environment and a strong dollar rally in London’s Ballinger Group.
“FX is guided by titles, which are widespread even outside the market, and this pays attention to market fluctuations,” he said.
The belief in this growth is growing in the operation of the alteration that the dollar’s power is here to stay for some time when victory tariffs come.
There is a common feeling that we have entered a stronger dollar after re-election of Trump … Starting the scale from September and the pace of people on the influence of FX movements on the bottom line, “said a number.
In recent weeks, several companies have provided a significant negative impact on unfavorable currency market movements.
Apple (:AaplIn late January, he warned that the stronger dollar would include 2.5 percentage points from the current quarter income for a year.
Johnson and Johnson (Jnj) He also said that unfavorable foreign currency steps shaved from $ 1.7 billion or 2%, while Microsoft warned the rise in its third trimester due to a stronger dollar.
Smaller and lesser FX-complicated companies that are often constrained by lean hedging budgets with a limited amount of capital, they can connect to the access to more advanced hedging programs at the best prices.
“The stronger dollar demands the treasury teams more carefully managing the FX risks in smaller corporists and implement voice hedging strategies to adapt to this new normal.
Amol Dargalkar, Executive Partner of Risk Management, said that in 2024, large companies were more than expected to review and update their hedging program, and it was not surprising that smaller companies were a number of companies.
Although the titles related to the tariff can prompt the pickup in hedging activities, the greater the escalation of trade tensions can undermine these efforts, as a comprehensive trade war can endanger business activities and practical exhibitions.
“For many businesses, they are at risk of cash flow here … Some may have to review their supply networks, while some may deal with lower-income in Toronto.
“It’s a very cross current, and it’s not just a linear growth of hedging volume,” Shamota said.
(Reports by Scab Iqbal Ahmed and Laura Matthews; editing, Lewis Krauskopf and Marguerita Choy)
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