Economic exposure to currency risk refers to changes in the value of monetary assets and liabilities due to unexpected changes in foreign currency exchange rates.

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Economic exposure (also known as operating or transaction exposure) does refer to the potential impact of unexpected changes in currency exchange rates on monetary assets and liabilities, as well as on future cash flows related to international trade or investment. Companies with significant foreign currency exposure may use various hedging strategies to mitigate the risks and uncertainties associated with currency fluctuations.

Economic Exposure to Currency Risk Refers to Changes in the Value