NEW YORK (Reuters) – The negative impact of currency fluctuations on North American companies’ results rose sharply again in the third quarter of 2022, data from treasury and financial management firm Kyriba showed on Tuesday.
The collective exchange-rate hit, including on companies in the United States, Canada and Mexico, was $43.15 billion in the third quarter of last year – the highest negative impact on record for the firm with data going back to 2013, Kyriba said in its report.
The negative effect was $34.25 billion in the second quarter of 2022.
Strong gains in the U.S. dollar last year weighed on U.S. corporate results, with the currency boosted by aggressive interest rate hikes by the Federal Reserve.
The U.S. dollar index was up 7.1% in the third quarter, but it declined 7.7% in the fourth quarter of 2022 and is down more than 1% so far for the first quarter of 2023.
A stronger dollar makes U.S. exporters’ products less competitive abroad while hurting U.S. multinationals that need to exchange their earnings into dollars.
(Reporting by Caroline Valetkevitch; Editing by Nick Zieminski)