FIRM PERFORMANCE AFTER CURRENCY SWING IN TURKEY
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Date
2023
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Nazarbayev University Graduate School of Business
Abstract
A currency swing is a large fluctuation in exchange rates, usually due to
unexpected market event. Sharp currency swings take place quite often in
currency markets. They are a normal feature of the flexible exchange rate
system. It usually illustrates the need for hedging solutions in order to protect
companies’ profit from sudden moves.
For the past few years Turkey is one of the countries, which has been
suffering from currency swing. It affects inflation rate in the country where the
prices for goods and minimum wage has to be reconsidered quite often. It is
quite important to note that the currency crisis historically had been quote an
issue in Turkey, which had undergone the denomination of the currency.
The main aim of this thesis to identify the extent to which currency swing
affect the return on capital employed, solvency ratio, current ratio, operating
revenue, cash flow, EBIT, EBITDA, gross margin, net income, total assets,
shareholder assets, profit margin, profit before tax and return on asset of the
selected companies. The research findings revealed that the impact of the
exchange rate volatility after currency swing on financial metrics of the firms
were insignificant. However, the measures on cash flow and gross margin had
shown significant results, precisely being predicted by the independent variables
of interest rate and the exchange rate.
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Citation
Khairashov, Sh. (2023). Firm Performance After Currency Swing In Turkey. Nazarbayev University Graduate School of Business