London, 15 December 2025 UK chief financial officers are overhauling their treasury operations in response to a turbulent year for the pound, according to the freshly released MillTech UK Corporate CFO FX Report 2025. The report, published today, highlights how sterling's extreme swings inflicted financial losses on almost 50% of surveyed corporates, catalysing a sharp increase in foreign exchange (FX) hedging activities.

From Volatility to Proactive Defence

Sterling's 'wild ride' throughout 2025 has exposed vulnerabilities in corporate FX management, with the report noting unprecedented volatility levels. This has driven 78% of UK firms to implement active hedging strategies up significantly from prior years as a bulwark against currency fluctuations.

However, this defensive shift comes at a steep price. Hedge costs have surged dramatically, squeezing margins for businesses already navigating high interest rates and global trade uncertainties. CFOs surveyed in the report described the need for 'speed and discipline' in treasury functions to mitigate these risks effectively.

AI and Automation Enter the Fray

In a bid to counter rising costs and enhance responsiveness, UK corporates are accelerating the integration of artificial intelligence (AI) and automation into their treasury workflows. These technologies promise real-time FX monitoring, predictive analytics, and automated hedging decisions, potentially restoring profitability to FX operations.

• 78% of firms now hedging FX exposure actively
• Nearly 50% reported losses from sterling volatility
• Sharp rise in hedge costs industry-wide
• Growing adoption of AI for treasury efficiency

The report underscores a broader trend: UK businesses are moving from reactive firefighting to strategic resilience in FX management. As global economic headwinds persist including US policy shifts and European slowdowns this evolution could define corporate competitiveness in 2026.

MillTech, a leading FX analytics firm, based its findings on responses from over 200 UK CFOs across sectors including manufacturing, retail, and tech. The data points to a maturing treasury landscape, where technology bridges the gap between volatility and value preservation.