Riding with the euro
PROBLEM: A European fuel buyer is concerned about the cost of its euro funding that is currently under water. Over the course of the year, the importer needs to buy US dollars on an ongoing basis to finance fuel purchases. At the moment, with euro strengthening, the client is not too concerned about hedging the specific cashflows but is interested in using euro strength to partly offset the interest rate exposure. On the other hand, since the client is currently paying fixed Euribor on an
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