Tuesday June 2, 2020

Getting to grips with foreign exchange risk

Currency movements can eat into profit margins in new markets, so planning ahead is key

23rd April, 2017
Sinead Fitzmaurice of TransferMate in Kilkenny Picture: Dylan Vaughan

Export markets can create valuable opportunities for Irish companies, allowing them to build revenues in new markets.

For businesses keen to trade internationally for the first time, however, it is worth bearing in mind that revenues and costs generated in different currencies carry their own risk.

This risk, called foreign exchange (FX) risk, occurs when currency movements eat into profit margins on sales in other territories. This risk occurs because the currencies bought and sold...

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