USD/INR Surges as Oil Spike From US-Iran War Hits Asian Currencies

Asian currencies are under significant pressure in early Monday trading as surging oil prices driven by the expanding US-Iran military conflict rattle regional markets. The Indian rupee has been particularly hard hit, with USD/INR pushing higher as India's heavy reliance on oil imports amplifies the impact of supply disruptions through the Strait of Hormuz. MUFG analysts note that the oil rebound is broadly pressuring Asian currencies, with knock-on effects expected for USD/KRW, USD/THB, and USD/MYR. Adding to regional market stress, the best-performing equity market of 2026 has been rattled by chip sector volatility and ETF unwinds, compounding risk-off sentiment. Safe-haven demand is likely supporting JPY and CHF in the near term. Traders should watch for potential central bank intervention in Asian FX markets if oil continues its ascent. Key resistance for USD/INR sits at recent highs, while broad dollar strength against EM currencies could persist if geopolitical tensions remain elevated and crude prices hold their gains.