Asia Credit Perspectives: EM Asia FX Risks - Lessen but Linger

Research evidence excerpt

Asia Credit Perspectives: EM Asia FX Risks - Lessen but Linger

J P M O R G A N Asia Pacific Credit Research

16 June 2026

Asia Credit Perspectives

EM Asia FX Risks - Lessen but Linger

Asian FX remains a weak spot in EM, as external funding challenges, higher Asia Pacific Credit Research

ACenergy costs, muted durable FX inflows and a firmer USD/rates backdrop continue Aman Aggarwal

to weigh on the region’s FX. Against this macro backdrop, we study how FX (852) 2800-0081

weakness could affect corporate credit across key Asian markets, finding that aman.aggarwal@jpmchase.com

while many issuers have natural or artificial hedges that should limit first-order Soo Chong Lim AC

impacts, vulnerability varies meaningfully by sector, balance-sheet structure and (852) 2800-7387

hedging strategy. We also see potential second-order impacts from various soochong.lim@jpmorgan.com

measures taken by central banks and governments to bolster their currencies, Matthew Hughart AC

including higher policy rates, capital-inflow incentives and FX-market (852) 2800-6518

matthew.hughart@jpmorgan.com

interventions, which may influence funding costs and liquidity conditions.

Alvin Au AC

• Asian FX remains vulnerable despite a more constructive EM FX (852) 2800-8533

backdrop. Our FX strategists continue to flag Asia as a softer part of EM FX alvin.au@jpmorgan.com

due to energy-price pressures, external funding challenges and muted durable Emma Xing AC

FX inflows against a firmer USD/rate backdrop. INR is seen as relatively (852) 2800-8727

emma.xing@jpmorgan.com

resilient in the near term, while THB, IDR, PHP and KRW remain subject to AC Shirley Yau

varying degrees of pressure.

(852) 2800-0566

• Indian corporates appear broadly protected from INR depreciation, but shirley.yau@jpmorgan.com