Brexit at ten: why currency planning still matters

Brexit provides a neat demonstration of why risk management is still so important

Ten years after the Brexit referendum, the UK’s trading environment is still changing.

The past decade has been shaped by near-constant change. New trade arrangements with the EU, supply-chain disruption, inflation, higher interest rates and shifting global demand have buffeted British business. The next decade is likely to bring further change, whether through closer UK-EU cooperation in some areas or new opportunities in markets further afield.

For British businesses, this creates a practical challenge. Growth often brings greater international exposure, but new suppliers, customers and markets can all affect how cash moves through the business. That is why currency planning still matters.

A shifting landscape

The UK and EU agreed a new strategic partnership at their May 2025 summit, setting out commitments to strengthen cooperation across areas including trade, energy, defence and agriculture.

Some of these commitments will take time to develop. Others may depend on further negotiation, implementation or even domestic political appetite. For businesses, the detail will matter. Changes that reduce friction could support trade, but they may also require companies to revisit supplier arrangements, pricing models or market plans.

At the same time, the UK continues to pursue trade relationships outside Europe. The government’s latest UK trade data shows that goods and services flows continue to shift month by month, with the total goods and services trade deficit widening in the first quarter of 2026 compared with the previous quarter.

The picture is not fixed. Businesses that trade internationally need to plan for a range of outcomes.

United Kingdom balance of trade:

New opportunities, new risks

Entering a new market can often be commercially attractive, but it can also introduce new financial risks.

A business selling into Europe may need to manage euro receipts. A company sourcing goods from Asia may need to plan dollar payments. A firm expanding into the Middle East, North America or other regions may face different payment terms, currency requirements and settlement timelines, depending on local norms and regulatory requirements.

These issues should not be left until the first invoice arrives. Currency exposure should be considered when contracts are negotiated, prices are set and margins are agreed.

A business that wins new international work without planning its currency position may find that the expected return changes before payment is made.

Currency planning supports better pricing

Many businesses have faced sustained margin pressure in recent years. Higher input costs, borrowing costs, wage costs and transport costs have made pricing decisions more difficult. Foreign exchange movement can add another layer of pressure.

For example, a UK importer may agree prices with customers based on today’s exchange rate, while paying suppliers in dollars or euros several months later. If the pound weakens before payment is made, the cost of that purchase rises. Unless the business has allowed for this movement, margin may be reduced.

The same applies to exporters. A business receiving overseas income may find that sterling strength reduces the value of future receipts once converted back into pounds.

Currency planning can help finance teams set more realistic prices, protect budget rates and understand where exposure sits within the business.

GBP/USD: Since the Brexit referendum

Certainty has value

No business can control the currency market. However, businesses can control how they prepare for it.

A structured treasury approach can give finance leaders a clearer view of future payments and receipts. It can also help them decide when certainty is more valuable than flexibility.

For some commitments, fixing a rate in advance may support budgeting and margin protection. For others, the business may prefer to retain some flexibility. The right approach depends on the company’s exposure, cash-flow needs, commercial priorities and attitude to risk.

The important point is that these decisions should be deliberate.

Without a plan, currency decisions often become reactive. A payment becomes due, the business checks the rate and the transaction is made. That may work in quiet markets, but it can leave the company vulnerable when conditions move quickly.

The next decade will reward prepared businesses

The next ten years of UK trade is sure to bring with it new developments and realities. Some businesses will use this period to expand into new markets. Others will strengthen existing supplier or customer relationships. Many will continue to balance opportunity with uncertainty.

Prepared businesses will be in a stronger position. They will understand where their risks sit. They will be able to price with more confidence. They will know when future payments are due and what exchange rate assumptions have been made. They will be able to act before market movement becomes a problem.

That does not remove uncertainty, but it can make it easier to manage.

How Smart Currency Business can help

Smart Currency Business helps companies manage and mitigate currency risk with comprehensive treasury solutions. We work with British business to understand future requirements, assess risk and put practical plans in place that help you meet (and often, exceed) your strategic objectives.

For businesses with international exposure, the next decade is unlikely to stand still. A considered treasury strategy can help protect margins, support cash-flow planning and give decision-makers greater confidence.

If your business trades internationally, now is the time to review your currency exposure. Speak to Smart Currency Business about planning your next 12 months of overseas payments.