Economic exposure refers to the changes in the present value of future cashflows that could occur as a result of an unexpected movement in foreign exchange rates. The reason is that the currency of both countries are subject to inflation or depreciation thus changing the exchange rates. A firm which regularly imports raw materials, which are invoiced and paid for in a foreign currency, is subject to economic exposure. A company which has cashflows that arise from regular exports denominated in a foreign currency is subject toeconomic exposure. A UK company receives remittance from a foreign investment centre.