Asia-Pacific FX Rattled as Iran Strikes Expand, Oil Surges 4%, Gold Drops

Asia-Pacific forex markets are under significant pressure as escalating US-Iran hostilities dominate risk sentiment. The US launched dozens of new strikes against Iranian targets including attack drones, while Iran retaliated with ballistic missiles targeting Jordan, broadening the conflict's geographic scope. South Korean equities sank over 5% led by profit-taking in SK Hynix, dragging the Korean won lower, while the Nikkei also fell sharply, pressuring USD/JPY toward yen strength. Oil prices jumped approximately 4% on Strait of Hormuz closure fears, bolstering commodity currencies like CAD but weighing on oil-importing nations' currencies including JPY, KRW, and INR. Gold declined over 1% despite the risk-off environment, likely reflecting position liquidation. On the data front, Goldman Sachs forecasts US core CPI to ease to 2.8% year-on-year in June, potentially offering the Fed room for dovish signaling. China's independent teapot refiners are adjusting procurement strategies amid supply disruptions. Traders should anticipate elevated volatility across all major pairs with particular focus on USD/JPY, AUD/USD, and USD/CAD.