- North American and European companies lost $22.5 billion in the second quarter because of the negative impact of currency exchange rates, according to the Kyriba Currency Impact Report.
- The findings mark the third consecutive quarter of losses of $20 billion or more, the longest streak tracked in the report in more than a decade.
- Trade tensions between the U.S. and China, as well as the uncertainty over Brexit, could lead to more losses.
"Currency volatility is having real, quantifiable consequences for companies," Wolfgang Koester, chief evangelist at Kyriba, said in a statement. "CFOs who dismissed this problem as a temporary wave of market drama need to reconsider their approach."
According to the findings, 316 companies — 291 in North America and 25 in Europe — reported negative currency impacts.
In North America — the U.S., Canada, and Mexico — companies were hit with $21 billion in negative impacts. In Europe, companies lost $1.5 billion.
- The euro was mentioned as the most impactful currency by North American companies for the 10th consecutive quarter, with nearly half of companies mentioning it during Q2 2019 earnings calls.
- The combination of the currency war between the U.S. and China and Brexit uncertainty has led to a record period of currency volatility.
- As long as U.S. and China issues and Brexit remain unresolved, impacts are expected to continue into Q4.
"At a time when the economy is slowing down, currency volatility is one way companies are losing ground to their competitors," the report said.