$9.5 Billion in Total Quarterly FX Headwinds for North American and European Multinational Corporations

Published 

San Diego – Kyriba’s Currency Impact Report (CIR), a comprehensive quarterly report detailing the impacts of foreign exchange (FX) exposures among 1,200 multinational companies based in North America and Europe, revealed a negative impact from currency volatility of $9.54 billion. North American companies experienced greater headwinds than their European counterparts in the first quarter of 2021, reporting $5.87 billion in FX-related negative impact — a staggering increase of 322% from the last quarter. By comparison, European corporations reported $3.67 billion in negative impact.

“Despite warnings that currency volatility would be on the rise, many companies were unprepared to manage FX exposures, according to the data. As businesses experience a post-pandemic surge in activity, CFOs were unable to keep up with currency movements, unnecessarily risking corporate liquidity,” said Wolfgang Koester, Chief Evangelist for Kyriba. “With nearly $10 billion in preventable losses, CEOs need their finance chiefs to understand the currency exposures within their balance sheet and take action to retain profits and maximise liquidity to sustain growth.”

Highlights from the July 2021 Kyriba Currency Impact Report include:

  • The average earnings per share (EPS) impact from currency volatility reported by North American companies in Q1 2021 held steady at $0.03 — three times greater than the recommended standard of $0.01 EPS impact.
  • Publicly traded North American companies that qualified to be monitored in the Q1 2021 report had a collective currency loss of $5.87 billion.
  • Publicly traded European companies that qualified to be monitored in the Q1 2021 report had a collective currency loss of $3.67 billion.
  • North American companies indicated the Chinese renminbi (CNY) as the most impactful currency, with 33% of companies referencing it as most impactful, snapping the Euro’s (EUR) hold as the most impactful currency over the last two quarters.
  • The U.S. dollar (USD) remained the currency most mentioned as impactful by European companies on earnings calls for the third quarter in a row, followed by the euro, with the Chinese renminbi ranking third.
  • The top five industries that experienced the greatest impact from currencies in North America (in order) were machinery, trading, distribution, professional services, healthcare equipment, biotech and pharmaceuticals and chemicals.
  • The top five industries that reported the greatest impact for Europe (in order) were electronic equipment, instruments and components, construction and engineering, airlines, biotech and pharmaceuticals, and chemicals.

The Kyriba Currency Impact Report is a comprehensive report detailing the impact of foreign exchange exposures among publicly traded companies. All companies analyzed in the report’s findings conduct business in more than one currency, with at least 15% of their revenue coming from nations that are located outside of their headquarters.

To learn more about specific industries affected and which currencies were most impactful to multinationals, download the full July 2021 Kyriba Currency Impact Report.

Most recent episodes

£15 Billion Stimulus Pumped into UK Economy to Ward Off Recession Fears

Welcome to the latest edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 7th June...

04:44

Advantage Treasury

Eleanor Hill is joined in the virtual TreasuryCast studio by Nicolas Cailly and Philippe Penichou (Societe Generale) to look at treasury trend predictions for the remainder of 2022, with a particular focus on virtual accounts. In this deep dive into current and future treasury priorities, our guests...

24:22

40th Annual New York Cash Exchange: What Can Treasurers Expect?

Ahead of the 40th annual New York Cash Exchange, two of TMANY's distinguished board members, David Miller and Timothy T. Hesler, CTP, provide TMI CEO, Robin Page, with a quickfire rundown of what attendees can expect from this year’s conference. Our guests share their aspirations for the event, explain...

09:58

Expectation-Beating Inflation Prints Ratchet Up Pressure on Monetary Policy

Welcome to the third edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 9th May...

04:48

Making the Sustainable Transition: A Roadmap to ESG in Treasury

Over the last 18 months, Societe Generale has experienced a steady increase in requests from their corporate clients to integrate ESG features in treasury management.  Louis-David Rouyer, Philippe Pougeard, and Emmanuelle Petelle (Societe Generale) provide TMI's Eleanor Hill with a whistlestop run...

22:24

Lift Off for Fed Rate Rises

Welcome to the latest edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 5th of...

04:58

Treasury in 2022 and Beyond

Industry experts Bob Stark (Kyriba) and Sebastian di Paola (PwC) join TMI's Editor, Eleanor Hill, to explore the very latest treasury trends - and to discuss how smart treasurers can get ahead of th...

43:21

How BearingPoint Harnessed Data-Driven Forecasting with CashAnalytics and SAP

Listen back to our recent forecasting masterclass, where Group Treasurer Eveline Stam, and Conor Deegan (CashAnalytics) provided TMI's Eleanor Hill with a comprehensive overview of how consultancy firm BearingPoint achieved company-wide cash forecasting nirvana by combining specialist solutions from...

37:14

The 3 T’s of The Future: Tech, Treasury, and Transformation

Over the past two years, an increasingly dynamic environment has not only accelerated technology development – from quantum computing to blockchain technology, and even the metaverse – but also technology adoption, bridging colleagues and breaking down silos in a remote work world. In this podcast,...

44:02

Monetary Policy Continues to Drive Markets as Ukraine Invasion Weighs on March Meetings

Welcome to the second edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 3rd of...

05:25