Super system faces trillion-dollar foreign exchange stress test

The country’s largest superannuation funds face greater scrutiny over the size of the currency hedge risk needed to protect the growing pile of retirement savings being invested in offshore markets, with concerns the current safeguards are inadequate.

Pension funds worth an estimated $1.35 trillion are invested overseas, of which about $400 billion is hedged against adverse currency moves, leaving the remaining two-thirds exposed to a rising Australian dollar.

Source: https://www.afr.com/markets/debt-markets/super-system-faces-trillion-dollar-foreign-exchange-stress-test-20250807-p5ml41