The country’s biggest retirement savings funds are sitting on currency hedging books that are individually closing in on $100 billion in value, with the sheer size of the market driving increased attention from regulators concerned about how it flows through the financial system.

While typically a protection against risk, the Reserve Bank of Australia has warned that there is an “extreme but plausible” scenario where FX hedges exacerbate liquidity stress on the $4.2 trillion superannuation sector if the dollar tumbles and forces margin calls that requires they quickly sell assets.