Philippine Peso, Indian Rupee, and other Asian currencies weaken as crude prices rebound, worsening trade terms and inflation risks.
The Philippine Peso led declines among Asian currencies, with the Indian Rupee, Indonesian Rupiah, and Thai Baht also weakening as oil prices rebounded. The surge in crude, driven by fading optimism over a swift reopening of the Strait of Hormuz, renewed pressure on net oil importers in the region.
Recent relief from lower oil prices had eased concerns over imported inflation and external balances, but the rebound highlights the fragility of this support. For economies like India, Indonesia, the Philippines, and Thailand, rising oil costs worsen terms of trade and inflation risks, leaving currencies vulnerable even if the broader USD environment improves.
Focus remains on upcoming US CPI data, which could influence Federal Reserve expectations and USD strength. However, the volatility in oil markets underscores persistent risks for oil-sensitive currencies.