While consumer shopping baskets are becoming dearer, and householders struggle with soaring energy bills, inflation has also hit currency hedging.
Sharp rises in the cost of foreign exchange options and forwards have forced corporate treasurers to rethink their hedging programmes. Some have cut back their hedges. Drinks maker Coca-Cola, for example, reported in its most recent earnings report that the total notional of derivatives designated to currency cashflow hedges decreased 20% from $7.4
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