Dollar climbs above 101 as rupee, won weaken further

Indian Rupee and Asian Currencies Weaken as Dollar Climbs Above 101

The Indian rupee weakened to around 94.69–94.74 against the US dollar on Monday and Tuesday, while the South Korean won remained entrenched above 1,500 per dollar, as a strengthening greenback and persistent foreign investor outflows pressured emerging market currencies across Asia.

Dollar Strength Drives Regional Weakness

The US Dollar Index rose to 101.42 on June 23, its highest level in over a week, up from 100.84 the prior session. The index has climbed steadily since mid-June, when it traded below 100. MUFG Research noted that the dollar “continues to edge stronger” with EUR/USD falling closer to 1.14 and USD/JPY pushing toward 162.mufgresearch

The rupee’s slide marks a roughly 9% decline from its level of 86.62 a year ago. The currency hit an all-time low near 96 in late March and May, coinciding with record foreign portfolio outflows. According to Reuters, foreign investors pulled more than $20 billion out of Indian equities in just the first four months of 2026, surpassing the previous year’s record annual withdrawal. Republic World reported that FII outflows reached nearly ₹2.3 lakh crore in the first five months of the year, exceeding all of 2025’s total of ₹1.7 lakh crore.ycharts

South Korea’s Won Stuck in Crisis-Era Territory

The South Korean won closed at around 1,536–1,539 per dollar on June 23, remaining well above the 1,500 level that has alarmed policymakers. The Chosun Ilbo reported in early June that the won had exceeded 1,500 for 12 consecutive trading days, breaking the previous record of 11 days set during the 2009 global financial crisis.tradingeconomics

South Korea’s Finance Minister Koo Yun-cheol called the won’s level “excessive” relative to fundamentals at a cabinet meeting on Tuesday, blaming foreign equity selling and pledging action against sudden market volatility. Foreign investors recorded net selling of 6.3 trillion won in a single session in early June — the third-largest on record.chosun

Broader Forces at Play

Analysts point to US two-year Treasury yields near 4% and the dollar index above 100 as key forces reducing appetite for emerging market assets. J.P. Morgan forecasts the dollar will remain elevated, with EUR/USD hovering between 1.13 and 1.15 over the next three quarters. MUFG noted that while Asian currency moves have been “orderly,” lower oil prices and risk sentiment remain the key supports preventing sharper declines.jpmorgan

The Japanese yen also came under pressure, with USD/JPY trading near 161.60 after reports that Japan’s finance minister held discussions with US Treasury Secretary Scott Bessent on currency matters.mufgresearch