Businesses should prepare for currency swings ahead of Germany’s election is the message from of Godi Financial – formerly OSTC FX.
Germany’s Federal Elections will take place on Sunday 24 September 2017 and despite polls suggesting the current Chancellor of Germany, Angela Merkel, will continue to lead the country, markets are nonetheless likely to react to the event, which could catch many businesses off guard, due to potentially significant currency swings.
That is the message from Paul Langley, managing director of Godi Financial – formerly OSTC FX. He claims businesses without a strategic approach to foreign exchange (FX) exposure could suffer during such political events, as currency markets react to the polls and final election outcome.
Germany is the largest economy in Europe and so the impact of its Federal Election can send ripples across Europe.
“Germany has an incredibly influential position within the EU and so the importance of these elections shouldn’t be underestimated. We have seen the Euro rise against many of the major currencies recently, which suggests confidence in Merkel maintaining her position as Germany’s leader, as well as a positive vibe in the country.
“As with any election, market fluctuations and volatility are expected and so for those businesses with Euro exposure, planning ahead is crucial. Being caught short on FX dealings because of an unstable market can be avoided with an FX partner that can help you to hedge accordingly. It can also help businesses to take advantage of favourable movements and benefit from any strength in the Euro.