HSBC has revised its year-end exchange rate forecasts upward for the US dollar against most Asian currencies, anticipating that oil prices will remain elevated through the second quarter and much of the third quarter.

Foreign exchange strategists, including Paul Mackel and Joey Chew, noted in a report that a prolonged stalemate could occur before any resolution on Iran, while concurrently, rising downside risks to economic growth are expected to exert further pressure on pro-cyclical Asian currencies.

The report highlighted that the Malaysian ringgit, Singapore dollar, and New Taiwan dollar are likely to demonstrate greater resilience. This is attributed to their distinct combinations of supportive factors, which include stronger energy security (ringgit), alternative growth sources (New Taiwan dollar), fiscal space (Singapore dollar), and the willingness and capability of authorities to defend their respective currencies.