Happy New Year from FXGuard! 🎉
As we step into 2025, we want to extend our heartfelt gratitude to all our partners, clients, and supporters for a remarkable 2024. Your trust and collaboration have been the cornerstone of our journey.
To kick off the year, we’re sharing an important analysis of currency volatility in 2024 and its implications for businesses engaged in global trade.
Key Highlights on Currency Volatility in 2024
1) Currency Volatility Across the Board:
Businesses trading with the UK’s global partners faced notable currency volatility in 2024, with some pairs seeing extreme swings:
- GBPTRY (Turkish Lira): Recorded the highest volatility, with a 21.62% max variation, despite a +17.7% annual performance.
- GBPJPY (Japanese Yen): A strong annual performance of +9.11% with 14.40% max variation, showing sensitivity to global macroeconomic changes.
- GBPNOK (Norwegian Krone): Delivered a +9.28% annual gain with slightly higher max variation of 9.63%
2) Annual Performance vs. Max Variation:
The annual currency performance shows the overall trend, but it’s the max variation (largest swings) that impacts businesses the most. For instance:
- GBPUSD had a modest -1.92% annual decline, but its 8.64% max variation exposed businesses to significant risk at specific times.
- GBPEUR demonstrated stability with +4.71% annual performance and a low 4.85% max variation, offering relative safety for Eurozone trade.
Businesses must prepare for volatility, as large swings can disrupt pricing, cash flow, and margins, regardless of annual trends.
3) 2024 Is Not an Indicator for 2025:
- Currency trends in 2024 are no guarantee of similar stability or volatility in 2025.
- Low-volatility pairs like GBPEUR and GBPDKK in 2024 may see unexpected swings.
Conversely, high-volatility pairs like GBPTRY or GBPJPY may stabilise in the year ahead.
This unpredictability reinforces the importance of robust FX risk management strategies to safeguard businesses from adverse movements.
📊 Please see Attached how main UK Trade partners currencies performed in 2024 on an annual basis as well as their maximum variation during the same 1 year period in 2024
At FXGuard, we empower SMEs to navigate currency risks effectively by providing tools that help monitor and mitigate volatility. Let’s face 2025 with confidence and resilience!
Here's to a prosperous and stable 2025 for all! 🥂
#FXGuard #CurrencyVolatility #FXRiskManagement #HappyNewYear2025