US and UK Firms Cut Currency Hedges to Two-Year Low
Firms in the US and UK reduced their currency hedges to the lowest level since 2024 during the second quarter. The shift reflects growing caution over interest rates and inflation as companies favor flexibility over long-term protection.
Insights:
Companies across the United States and the United Kingdom cut their currency risk hedges to 46% in the second quarter, hitting the lowest level since tracking began in early 2024. The drop follows escalating uncertainty over global interest rates and inflation paths. The reduction leaves corporate balance sheets more exposed to foreign exchange turbulence as executives opt for tactical flexibility over locked-in protection.
