The European Central Bank (ECB)’s strategy of aiming for a weak euro may prove fruitful for European businesses that export outside of the Eurozone.
“Companies in the Eurozone that make their income in US dollars or sterling would benefit from a weaker euro,” says Carl Hasty, Director of international payment specialists Smart Currency Business.
“The opposite case would apply for UK exporters trading with Eurozone countries, particularly if they are pricing in euros. UK exporters need to have robust currency strategies in place in order to minimise the losses that can stem from currency exchange.”
“UK importers, on the other hand, benefit from a weaker euro, as their purchases are relatively cheaper. However, it is still crucial for importers to have the appropriate currency strategies in place to ensure that they minimise the risks that a potentially strengthening euro or weakening sterling would have on their bottom line.”
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