The rise of AI in corporate FX risk management

Traditional FX risk management processes are often manual, time-consuming and reliant on outdated tools—making it harder for corporates to respond quickly and efficiently in today’s volatile markets. It’s little wonder, then, that all respondents in our recent North American and UK corporate FX surveys said they are exploring the use of AI in some capacity to improve both operations and decision-making.

In this blog, we take a closer look at how corporates across both regions are starting to adopt AI to reduce their reliance on resource-heavy manual tasks, and move towards more intelligent, tech-driven FX solutions.

 

AI as a strategic tool for FX risk management

AI is rapidly becoming a strategic priority for corporates on both sides of the Atlantic—especially as firms search for smarter ways to navigate currency volatility. Faced with ongoing geopolitical tensions, diverging monetary policies and a backdrop of macroeconomic challenges, FX risk management is naturally emerging as a key area of interest for innovative technologies.

Corporates are beginning to take action:

• 46% of firms in North America are exploring how AI could help them anticipate and manage FX risk.
• 43% of UK corporates report a similar level of interest in using AI for FX management.

While these numbers reflect consideration rather than full-scale adoption, they signal a clear shift: AI is moving from theory to strategy in the world of corporate treasury.

Commenting on the trend, Sam Hunt, CTO at MillTech, affirms:

“The genie is well and truly out of the bottle with generative AI and any organisation not thinking about how this technology can enhance their offering risks being left behind. It’s clear from the findings that CFOs realise that in today’s fast-paced digital landscape, embracing AI-driven innovation is no longer optional but essential for staying competitive.”

Early-stage exploration beyond risk management

Building on this momentum, process automation and FX operations are also emerging as key areas of AI exploration among corporates in both North America and the UK:

• 39% of North American corporates and 41% of UK corporates are investigating how AI can streamline internal processes and drive greater operational efficiency.
• 36% in North America and 42% in the UK are focusing on applying AI within FX operations to reduce their reliance on manual procedures.
• 35% of corporates in North America and 26% in the UK are exploring AI to enhance trade execution, highlighting its growing potential to improve the speed, accuracy and consistency of FX transactions.

Together, these trends point to a broader shift: corporates are not only recognising the strategic value of AI, but actively seeking ways to embed it across their FX management strategy.

 

AI use cases in FX

According to Justin Xu, Head of Quant and AI Strategy at MillTech, AI is unlocking new levels of precision and control in currency management.

Predictive analytics for FX risk management

Machine learning algorithms analyse diverse source of information, including historical price movements, macroeconomic indicators, and central bank policies, to predict the direction and magnitude of currency market risks. These insights enable CFOs and treasurers to make more informed hedging decisions, minimizing exposure to currency risk.

Natural language processing (NLP) for sentiment analysis

NLP-powered AI models process news articles, central bank statements, and social media sentiment to assess market conditions. By extracting insights from both structured and unstructured data sources, corporates can more effectively manage event-related currency risks, thereby gaining a competitive edge in FX risk management decisions.

AI-powered process automation

Many FX-related tasks, such as trade reconciliation, compliance reporting, and KYC/AML processes, are time-consuming and prone to human error. AI-driven automation tools can help to streamline these workflows, reducing manual effort and improving accuracy.

 

Looking ahead: What's shaping the future of FX?

When it comes to the future of FX operations, corporates on both sides of the Atlantic are placing their bets on emerging technologies—but not always in the same order.

In North America, corporates are most optimistic about the impact of automation and data-driven tools, with notable interest in several other technologies:

• Automation and Big Data analytics were each chosen by 26% as the most impactful technologies over the next five years.
• 18% expect quantum computing to play a significant role.
• 16% point to AI as a transformative force.

In the UK, corporates are leaning more heavily into blockchain and AI-led transformation:

• 23% cite blockchain as the most influential technology on the horizon.
• 21% highlight automation tools as a priority.
• 21% also believe AI will shape the future of FX operations.

While AI is a consistent theme across regions, the variation in top priorities likely reflects differences in market maturity, regulatory environments and innovation appetite. What’s clear, however, is that FX functions are entering a transformative era—where advanced technologies are shifting from experimental to everyday use in FX strategies.

 

Reimagining FX with AI: Inside MillTech’s next-gen approach

At MillTech, we’re applying AI in practical, targeted ways to streamline processes and improve efficiency across the business and for our clients.

Smarter compliance through document intelligence

To ease the burden of regulatory onboarding, we’ve developed a generative AI solution that accelerates KYC and AML processes with our 15 counterparty banks. By extracting key information from complex legal documents, this tool significantly reduces manual effort and improves accuracy, transforming what was once a time-consuming task into a streamlined workflow.

Empowering developers with AI-Driven code search

Internally, we’re using generative AI to supercharge our development process. Rather than relying on outdated or scattered documentation, we use generative AI to let developers query the codebase directly, allowing them to retrieve accurate, context-aware answers, saving valuable time.

Introducing Co-Pilot

We’re now extending these AI capabilities to our clients through Co-Pilot, our newly launched risk advisory solution, embedding intelligence directly into FX risk management decision-making.

By drawing on macroeconomic indicators and historical pricing data, Co-Pilot delivers intelligence-led insights that empower clients to:

• Translate raw FX exposures into meaningful, actionable insights.
• Simulate hedging strategies and explore alternative FX and liquidity scenarios.
• Monitor cost and carry dynamics across currencies, instruments, and time horizons.
• Assess the impact on cashflows, internal rate of return (IRR), and other key performance metrics.

Get in touch to discover how Co-Pilot’s can help your business make smarter, faster decisions.

 

 

This blog examines the data and results of surveys by Censuswide on MillTechFX’s behalf conducted in June 2024 (North America) and September 2024 (UK) based on surveys of 250 CFO’s, treasurers and senior finance decision-makers in mid-sized corporates (described as those who have a market cap of $50mil up to $1 billion and £40m to £791m).