Currency devaluation ‘could hurt European firms’

<p>European companies could be damaged if currencies are devalued quickly.</p>

A swift devaluation of currencies could prove to be damaging to companies across Europe.

This is the view of Christian Stocker, equity strategist at UniCredit, who explained firms will be able to cope as long as currency values do not depreciate too quickly.

Speaking to Reuters, he explained that if the process is sudden and fast this is where it is likely problems could arise for European companies.

Mr Stocker pointed out that the speed of the recent devaluations was "extreme", adding: "There is a high risk that these could get reflected in the third quarter earnings."

The Indian rupee has been particularly week in recent weeks and the currency has regularly hit a new record low when compared to the US dollar.

However, Chris Towner, director of FX Advisory Services at foreign currency exchange brokers HiFX, suggested this could prove to be good for the Indian economy in the long run.

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