The shadow of prolonged Middle East conflict looms as Asian currencies face dual pressures

Golden Ten Data reported on March 30 that Lloyd Chan of MUFG stated in a research report that recent developments increasingly point to the possibility of a prolonged Middle East conflict. The senior currency analyst said: “Risk aversion sentiment, combined with the risks that elevated energy prices may push up U.S. inflation and keep U.S. interest rates elevated for longer, continues to support the dollar and intensifies the resistance faced by risk-sensitive assets.” Chan added that Asian currencies such as the Indian rupee, Philippine peso, Korean won, and Thai baht are particularly at risk because these countries rely on energy imports and are sensitive to high oil prices through inflation and current account channels. Data from the London Stock Exchange Group shows the dollar rose 0.5% against the Philippine peso to 60.763, having earlier hit an intraday record high of 60.776.