Thousands of Miles From the Iran War, Asia’s Currencies Feel the Strain

The Indian rupee and the Philippine peso have fallen to record lows. Japan and South Korea have spent billions propping up their currencies in an attempt to avoid the same fate. The Indonesian rupiah is now weaker than it was at the depths of the Asian financial crisis.

For Asian countries that rely heavily on imported energy, the war in the Middle East has already sent oil prices soaring. Now, they face a knock-on effect that has grown into a crisis of its own: tumbling currency values, battered by rising fuel costs and skittish investors fleeing to the safety of the U.S. dollar.

To stem the slide, central banks across Asia have repeatedly intervened in currency markets, drawing down foreign exchange reserves they amassed over the years for precisely this kind of moment.

Those interventions, which involve selling dollars and buying local currencies, have averted an outright free fall. But with no end to the war in sight, concerns are rising about the long-term costs of riding out the crisis, including how long central banks can keep depleting their reserves if import prices continue to climb.

Article source: https://www.nytimes.com/2026/05/22/business/asia-currency-iran-dollar.html