Foreign exchange (FX) has moved into the investment conversation for North American corporates. Policy uncertainty, dollar volatility and shifting rate expectations are delaying projects, reshaping supply chains and changing where companies make, buy and sell.

MillTech’s North America Corporate FX Report 2026, based on a June survey of 250 senior finance decision-makers at mid-sized corporates across the US and Canada, found that 90% have delayed investment decisions over the past 12 months because of US policy uncertainty. For 39%, those delays have been significant.

Dollar volatility has pushed FX even further into operational planning. Some 81% of respondents said recent dollar moves had led them to adjust sourcing or manufacturing strategies that affect FX transactions, including 32% who have significantly altered their supply chain.

Eric Huttman, chief executive officer of MillTech, said: “North American corporates are facing a market where policy uncertainty is delaying investment decisions and reshaping business strategy. FX risk has become a boardroom issue.”

Rate policy is the biggest external pressure point. Federal Reserve and Bank of Canada decisions were the largest influence on FX hedging strategy, selected by 38% of respondents. US tariffs and trade policy followed at 33%, with Middle East geopolitical tensions at 28%.

Dollar volatility has split the field. Almost three-quarters (72%) said recent moves had helped FX returns this year, including 30% reporting a significantly positive impact. Another 19% reported a negative effect, underscoring how the same market can protect one company’s margins while eroding another’s.

Hedging strategies shift after 2025 peak

Protection remains widespread, even after last year’s high point. Some 82% of North American corporates hedge forecastable currency risk, down from 91% in 2025 and broadly back in line with earlier years.

Non-hedgers are now reassessing the decision. Among companies that do not currently hedge, 72% are considering hedging due to market conditions, the highest level in four years. That compares with 65% last year, 51% in 2024 and 69% in 2023.

Capital allocation is the main objection among non-hedgers. Some 35% said cash was better deployed elsewhere, while 30% cited burdensome hedging infrastructure. Minimal exposure was cited by 22%, with direct cost at 13%.

Hedging cost increases have eased from last year’s spike. Respondents reported a mean rise of 52%, down from 76% in 2025, while 8% said costs had more than doubled, compared with 20% last year.

Tom Hoyle, head of corporate solutions at MillTech, said: “Don’t wait for the toothache. Saving money by avoiding FX protection can create larger costs when volatility bites.”

Firms are also changing the shape of their hedges. In response to US policy uncertainty, 48% plan to lengthen their hedges and 47% plan to increase their hedge ratios. A smaller group is moving in the opposite direction, with 17% planning to decrease the hedge ratio and 17% planning to shorten the hedge length.

Average hedge ratios have eased to 47%, from 50% in 2025, 49% in 2024 and 60% in 2023. Average tenors have held broadly steady at 4.93 months, almost unchanged from 4.91 months last year.

Smaller hedgers are taking more cover than their larger peers. Among firms that hedge, the smallest companies have higher average hedge ratios than the largest, at 51% versus 46%, and hedge further out, at 5.4 months compared with 4.8 months. For some smaller businesses, once the decision to hedge is made, the preference appears to be for more certainty.

The product mix is broad. Foreign currency bank accounts, deliverable forwards, spot transactions and currency options are all used by more than a third of hedging firms, reflecting the different exposures, cash-flow timings and risk appetites companies are trying to manage.

Digital execution exposes old habits

Digital execution is advancing unevenly. Online user interfaces are now the most common way to instruct FX transactions, used by 55% of firms, up from 40% in 2025. Email still carries half of all FX instructions. Usage has surged to 50%, more than doubling from 24% last year, while phone use has risen to 33%. Another 42% send or upload files, 38% instruct through their own IT system and 25% use APIs.

Sam Hunt, chief technology officer at MillTech, said: “Many corporates have adopted digital tools, but the persistence of email and phone shows the transformation is far from complete.”

A gap remains between digital access and digital workflow. A company may start the process through an online interface while still depending on email, spreadsheet records, manual approvals or separate systems to compare quotes, evidence decisions, and reconcile activity afterwards.

Counterparty access is another pressure point. Respondents trade with an average of 4.47 active FX counterparties. A concentrated panel may suit some companies, but pricing, credit appetite and liquidity can shift quickly in volatile markets.

Regulatory and compliance support ranked as the joint most important factor when evaluating an FX provider or platform, at 34%, level with credit extension from counterparties. Independent transaction cost analysis or best execution measurement followed at 32%. Credit rating of FX counterparties was cited by 31%, while transparency of costs and automation of manual processes both stood at 30%.

Visibility becomes the bottleneck

Real-time data is the strongest operational signal in the report. Lack of real-time data and transparency was the top challenge in FX operations, cited by 28% of respondents. Getting comparative quotes and onboarding liquidity providers followed at 26% each. Fragmented service provision was cited by 24%, while demonstrating best execution fell to fifth place at 23%.

Best execution has slipped down the list because the problem has widened. Companies still need to evidence execution quality, but they also need to see exposures, compare available pricing and understand counterparty options while markets are moving.

Credit pressure is still visible. Fewer firms reported tightening than last year, but 42% said providers had tightened lending criteria, and 58% said credit providers had increased interest rates or fees. This is down from 69% in 2025, but still represents a substantial share.

Visibility is where those pressures meet. It affects how quickly firms identify exposures, how confidently they compare prices, how easily they demonstrate execution quality and how well they understand the credit and liquidity available to them.

Technology moves from adoption to control

Automation has shifted from an optional efficiency project to a baseline expectation. No respondents said they were not considering automation. Price discovery was the most common process being considered for automation, selected by 48%. Risk identification and trade execution followed at 43% each, with full FX workflow automation at 42%, reporting at 40%, onboarding liquidity providers at 38% and settlement at 30%.

AI adoption is almost as widespread. Only one respondent said they were not considering AI. Process automation was the leading use case, at 53%, followed by risk management at 52%, risk identification at 43%, FX operations at 42% and execution at 36%.

The prize is faster control. In an FX environment shaped by policy uncertainty, companies want earlier risk identification, better decision support and a shorter route from visibility to action.

Scaling AI safely is where the difficulty starts. Model risk or governance concerns were the biggest obstacle to wider use in FX or treasury operations, cited by 19%. Cyber and privacy concerns followed at 18%, with integration into ERP, TMS and banking systems at 14%. Poor or fragmented data and a lack of internal expertise were each cited by 12%.

CFOs and treasurers feel different pressures

The data separates the boardroom from the dealing desk. Some 93% of CFOs said US policy uncertainty had delayed investment decisions, compared with 50% of treasurers. Additionally, treasurers were much more likely to report damage from dollar volatility. Some 42% said it had negatively affected FX returns, compared with 9% of CFOs.

The split is logical. CFOs are closer to capital allocation, investment delay and board-level risk appetite. Treasurers face pressure across execution, counterparty access, credit extension, liquidity, and operational resilience.

Automation priorities also diverge. Among treasurers, trade execution is the top process being considered for automation. Among CFOs, full FX workflow automation ranks highest.

The country split sharpens the same point. Canadian firms are more likely to report delayed investment decisions and supply-chain adjustments, while US firms are more likely to report a negative impact from dollar volatility. Canadian firms are less likely to hedge, although non-hedgers in Canada are more likely to be considering it.

Mean hedge ratios are higher in Canada than in the US, while US firms hedge further out on average. Limited internal expertise is more likely to be cited as a challenge in Canada, while onboarding liquidity providers is the top challenge in the US.

From volatility to visibility

The MillTech report captures a corporate FX market moving deeper into business planning. Currency risk is now testing how companies make decisions under uncertainty, from investment timing and sourcing strategy to liquidity, counterparty access and operating design.

Investment delays, supply-chain changes, rising hedging costs, uneven dollar outcomes and fragmented execution tell the same story. FX management is becoming a test of governance and operating design as much as market judgement.

The work now is practical: cleaner exposure data, faster quote comparison, a broader counterparty view, stronger evidence of execution quality and technology that reduces manual friction without creating fresh models or cyber risk. Policy uncertainty may have forced the issue. Visibility will determine how well companies respond.