Contract FX risk

Exchange rate differences on an FX deal — rate scenarios and UAH result impact

Parameters

Contract amount, $

Current rate, UAH/$

Rate change by payment, %

Scenarios

At current rate415000 ₴

Rate +8% (buyer)448200 ₴ (+33200)

Rate −8%381800 ₴ (-33200)

Buying currency to pay: UAH devaluation raises the contract cost. Export revenue — opposite: weaker UAH = more hryvnia. Protection: forward/rate lock in the contract, partial prepayment, split payments. Risk >10% of the amount is a reason to hedge.