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U.S. Presses South Korea on Strait of Hormuz Naval Support Amid Rising Energy Tensions 
Asian currencies traded within a narrow range on Tuesday as rising oil prices, fueled by ongoing U.S.-Israel military operations against Iran, dampened investor risk appetite across the region. Most major currency pairs saw minimal movement as traders remained cautious amid geopolitical uncertainty.
The Australian dollar edged higher by 0.2%, outperforming its regional counterparts ahead of an anticipated interest rate decision by the Reserve Bank of Australia. Markets widely expected the RBA to raise its benchmark rate by 25 basis points to 4.10%, supported by a series of hawkish signals from the central bank in recent weeks. The move is seen as a preemptive measure against energy-driven inflation tied to the ongoing Iran conflict, with another rate hike projected for May.
Global attention is also focused on the U.S. Federal Reserve, which is scheduled to announce its rate decision on Wednesday. Meanwhile, the U.S. dollar index climbed modestly during Asian trading hours after retreating from near 10-month highs in the previous session.
The Japanese yen recovered slightly, with the USD/JPY pair gaining 0.2%, though it remained well off a recent 19-month peak. Japanese Finance Minister Satsuki Katayama reiterated Tokyo's readiness to intervene in currency markets if volatility escalates. The Bank of Japan, also meeting this week, is expected to hold rates steady while signaling a more hawkish policy stance. Governor Kazuo Ueda noted that underlying inflation continues to move toward the BOJ's 2% annual target.
Across broader Asian markets, currency movements were mixed. The Chinese yuan strengthened modestly following a firmer central bank fixing, while the Singapore dollar slipped after weak trade data. The South Korean won declined, the Taiwan dollar gained slightly, and the Indian rupee edged lower against the dollar, staying below recent record lows amid suspected RBI intervention.
Surging oil prices remain the dominant concern for Asian economies, most of which depend heavily on energy imports. Iran's continued blockade of the Strait of Hormuz and retaliatory strikes on U.S. and Israeli assets in the region have kept supply disruption fears elevated, adding further pressure on regional currencies and economic outlooks.
