“The greenback’s unprecedented weakness has triggered an earnings disaster for U.S. global firms, with Q1 reports confirming:
S&P 500 Impact
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47% of S&P revenues come from abroad
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Every 10% dollar drop reduces aggregate earnings by 6.3%
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Q1 currency translation losses totaled $217 billion
Sector-Specific Carnage
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Tech: Microsoft’s international revenue down 11% in dollar terms
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Pharma: Pfizer’s European sales dropped 14%
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Industrials: Caterpillar’s Asia-Pacific earnings fell 19%
“These are the worst currency headwinds since the Plaza Accord era,” warns Goldman Sachs CFO Denis Coleman. “Our hedging programs can’t keep pace with this volatility.”
Companies are responding with:
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Production relocation (Apple moving iPhone 17 manufacture to India sooner)
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Dynamic currency pricing (Amazon adjusting international prices daily)
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Radical hedging strategies (Tesla buying $5B in forex options)
