CORPORATE FINANCIAL STRATEGY ADAPTATION TO GLOBAL INTEREST RATE SURGES AND LIQUIDITY CRISIS

Abstract

The volatility of global interest rates and recurring liquidity shocks have become critical externalities influencing corporate financial strategy in the post-pandemic economic landscape. This study investigates how corporations adapt their financial structures, capital allocation, and risk management frameworks in response to the tightening of global monetary policies and emerging liquidity constraints. Employing a mixed-method approach that integrates panel data analysis of 120 multinational firms across OECD and ASEAN countries with in-depth case studies, this research identifies key strategic shifts, including debt restructuring, liquidity buffer optimization, hedging practices, and investment reprioritization. The findings reveal a significant pivot from aggressive leveraging to a more conservative capital structure, coupled with enhanced emphasis on cash flow forecasting and access to diversified credit lines. Moreover, companies demonstrating higher financial agility marked by dynamic scenario planning and adaptive liquidity risk governance showed greater resilience amid interest rate shocks. This study contributes to the literature on strategic financial management by providing a multi-regional perspective on corporate adaptability in high-volatility environments, offering actionable insights for CFOs and policymakers aiming to strengthen corporate financial stability in an era of global uncertainty.