Analysis

Continued evolution

2016 Global Foreign Exchange Survey

The Deloitte Global Treasury Advisory Survey was crafted in response to the recent high profile and impact of Foreign Exchange on business. The survey is comprised of 133 corporations from around the globe, representing a wide array of size, geographies and industries.

Key highlights: 2016 Global Foreign Exchange Survey

  • 2016 is expected to exhibit similar levels of FX uncertainties as 2015 with different expectations around interest rate policies, quantitative easing removals, potential depegging of some currencies and other actions by global economies all driving FX volatility.
  • Corporates’ ability to manage currency risk effectively will continue to be tested in 2016 and there are a number of key areas to consider throughout the survey, including treasury challenges, the board agenda, treasury structures, hedging strategies and the use of technology.
  • The lack of visibility over FX exposures and of reliable forecasts, and the manual nature of exposure quantification is a challenge for nearly 60% of corporates. Without accurate measurement, risks cannot be managed effectively.
  • Boards do not always receive sufficient information in relation to FX risk according to 37% of corporates which limits the board’s ability to challenge and guide. Treasurers have an opportunity to review their reports and to communicate key FX risk metrics aligned to wider financial and strategic measures.
  • Technology and innovation are recognised as important enablers to achieve efficient and effective FX processes, yet many organisations still deal with a multitude of source information systems with limited interconnectivity. 59% of corporates use two or more information sources to identify exposures with 63% of corporates relying on manual forecasting processes.
  • Primary hedging strategies (rolling, layering and flat hedge ratio) vary by industry, but overall hedging strategy objectives are focussed on protecting cash and minimising volatility in income statements.

2016 Global Foreign Exchange Survey

Key findings

Previous Deloitte Treasury Surveys

2015 Global Corporate Treasury Survey

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