Dollar Rampages Again: Won, Ringgit, Yen, and Rupiah Collapse in Unison

Asian currencies weakened against the US dollar in early trading on Monday, as the dollar index resumed its upward trend. Based on Refinitiv data as of 09:20 WIB, all ten monitored Asian currencies fell against the greenback. The rupiah slipped 0.25% to Rp17,990 per US dollar, bringing it dangerously close to the psychological level of Rp18,000. The South Korean won suffered the deepest pressure, falling 0.33%, followed by the Taiwan dollar and the Japanese yen. The Malaysian ringgit, Chinese yuan, Singapore dollar, and Vietnamese dong also recorded declines. The broad Asian currency weakness occurred as the US dollar index strengthened 0.11% to 100.968. The greenback had been under heavy pressure last week, recording its steepest weekly drop since April following data showing a sharp slowdown in US job creation. This had prompted markets to scale back expectations for further Federal Reserve interest rate hikes. However, OCBC strategists noted that the decline in the unemployment rate still indicates a tight labour market, keeping expectations for policy tightening alive. They maintained a view that the dollar could strengthen moderately by around 2-3% in the second half of 2026. Meanwhile, falling oil prices helped ease some inflation concerns, potentially limiting the Fed’s room to raise rates. Markets are now awaiting minutes from the Fed’s June meeting for further clues on the policy outlook, though Commonwealth Bank of Australia strategists suggested the minutes might be less revealing than usual.