The rebound in oil prices is likely to weigh on Asian currencies, Lloyd Chan of MUFG Bank says. This comes as “geopolitical risk premia rise and tanker traffic through the Strait of Hormuz declines,” the analyst says. The Thai baht and Indian rupee have shown heightened sensitivity, noting a roughly 1% depreciation against the dollar last week. “For the baht, risks remain skewed down, especially with Thailand’s deteriorating external balance,” Chan adds. The dollar is up 0.2% at 33.66 baht.

The dollar is likely to trade near its year‑to‑date high of 162.84 yen this week, three members of CBA’s Global Economic & Markets Research say. Focus is on Japan’s inflation data due Friday. “Weaker‑than‑expected core inflation could delay the Bank of Japan’s next policy tightening,” the members say. This could push the dollar beyond resistance at the year‑to‑date high against the yen. The dollar is little changed at Y162.33, LSEG data show.

Overall, rising oil prices and tightening geopolitical conditions create a challenging environment for Asian currencies. The baht and rupee face pressure, while the dollar remains strong near its highs. Investors should watch Strait of Hormuz traffic and Japan’s inflation releases, as they could further influence currency movements.