← Foreign Exchange (Forex) Products and Risk Management

Hedging strategy, policy and market outlook

Module 04 / 5 · 65 min

Design a corporate hedging policy, choose hedge ratios that balance cost and protection, and explain rate expectations responsibly.

In this module you will learn to

Set out the parts of a corporate FX hedging policy
Choose and justify a hedge ratio for committed and forecast exposures
Compare outcomes of different hedge ratios across rate scenarios
Give an overview of hedge accounting under IFRS 9
Use NBE, IMF and market data to explain rate expectations without making promises

Built on

Erudite Africa course specification: 1.l Foreign Exchange (Forex) Products and Risk Management, Level 2 Intermediate (October 2026)
Erudite Africa: Ethiopian Context programme overview and regulatory register (October 2026)
NBE directives as listed in the lessons: FXD/01/2024, FXD/04/2026, FXD/05/2026, SBB/96/2025
National Bank of Ethiopia Proclamation No. 1359/2025
NBE Monetary Policy Committee meeting No. 7 press release (13 July 2026)
IFRS 9 Financial Instruments (hedge accounting overview)

Examples and companies are fictional. Bank practices are shown as typical Ethiopian practice, not as any one bank's policy. Always apply your own institution's approved policy and the current NBE directives.