Asian central banks are increasingly facing currency pressures originating outside their borders. From South Korea to India and the Philippines, policymakers have ramped up efforts to curb offshore forex speculation as high oil prices, foreign fund exodus and a strong dollar pressure regional currencies.

South Korea’s finance ministry said on Sunday it will step up oversight of offshore currency derivatives. The Philippines has asked banks to ensure non-deliverable forward contracts are limited to economic purposes, while India has tightened limits on banks’ net open position to $100 million.

Indonesia, which unexpectedly raised interest rates on Tuesday, has said its central bank is active in currency markets “around the world, around the clock” to support the rupiah.

The warnings underscore concerns among Asian policymakers that offshore trading is adding to pressure on currencies. The oil-price shock from the US-Iran conflict has worsened the problem, hitting the region’s energy-importing nations. Indonesia’s rupiah breached the closely watched 18,000-per-dollar level, the Korean won has fallen to its lowest since the global financial crisis, while the Indian rupee and Philippine peso have hit record lows.

The efforts to curb offshore forex trading may help ease some pressure, but analysts doubt they can reverse the trend on their own.

“It may have some impact, but ultimately for the measure to be successful there needs to be a shift in the fundamentals as well,” said Michael Wan, senior currency analyst at MUFG Bank Ltd.

Non-deliverable forwards are cash-settled derivative contracts that allow investors to hedge or speculate on currencies outside local markets. They make up for about 4% of the global $10 trillion a day FX market, according to Deutsche Bank AG, though they can play an outsized role in Asia where restrictions on convertibility are common.
That means activity driven out of global financial hubs such as Singapore, London and New York can sway local markets.

Authorities across the region have tried to reduce this influence during periods of currency stress.

India allowed local banks to participate in the NDF market in 2020 and has since tried to attract activity onshore to its finance hub at Gujarat International Finance Tec-City, or GIFT City. South Korea has opened its forex market to overseas investors and extended trading hours, while Thailand has allowed non-resident corporates to access onshore baht liquidity and hedge freely.

“The reason the NDF market exists is due to restrictions in the onshore market,” said Khoon Goh, head of Asia research at Australia & New Zealand Banking Group. If those restrictions are eased and there is enough liquidity, the need for NDFs will gradually fade, as seen in the case of the Singapore dollar and Thai baht, he said.

Short-Dollar Book

Yet, the war-induced crisis has left some central banks with little choice but to intervene in those very markets they’ve been warning against. That defense has contributed to the drop in foreign-exchange reserves in the region.

The Reserve Bank of India has been particularly active, selling dollars primarily in shorter maturities, traders say. The central bank’s short dollar book, which includes offshore derivative positions, has likely surged to around $115 billion. Bank Indonesia has also sold dollars overseas to stabilize the currency.

The interventions have helped reduce outsized spillovers from offshore to local markets. In India’s case, the central bank has often been seen intervening just before onshore open to ease pressure on the rupee.

Some investors say currency weakness is the result of economic problems in individual countries rather than offshore trading.

India is facing persistent capital outflows, with global funds pulling a record $30 billion from stocks this year, spurring recent efforts to attract overseas capital. In Indonesia, investors are growing wary of the economic outlook and fiscal trajectory under President Prabowo Subianto.

The Philippines is facing a renewed inflation shock from high oil prices, while South Korea has seen over $78 billion of net foreign investment exit its stock market so far in 2026 despite a rally to record highs earlier this month fueled by retail craze for artificial-intelligence stocks.

The steps central banks have taken, including intervening in offshore markets, are aimed at curbing sharper market moves, said Lavanya Venkateswaran, senior economist at Oversea-Chinese Banking Corp. “We still think that policy rate hikes are on the cards” for India, the Philippines and Indonesia, she said.

Elon Musk-led SpaceX is set to debut on Nasdaq on June 12 after raising about $75 billion at a valuation of nearly $1.75 trillion, making it one of the largest public offerings in history. But the IPO may not be the only catalyst for the stock.

According to Jefferies strategist Chris Wood, recent rule changes by Nasdaq could allow SpaceX to enter the Nasdaq-100 index after just 15 trading days, compared with the earlier requirement of a three-month waiting period.

The change could create sharp demand for the stock, as passive funds that track the Nasdaq-100 would be required to buy SpaceX shares once it becomes part of the benchmark.

In his latest GREED & fear note, Wood said Nasdaq has removed minimum free-float requirements for large IPOs and introduced a “fast index inclusion” framework. Under the new rules, mega-cap listings such as SpaceX can enter the Nasdaq-100 shortly after listing.

What makes the situation unusual is that only about 4.2% of SpaceX shares will be freely tradable after the IPO. Despite this, the company will reportedly be treated as having a 12.7% free float for index-weight calculation purposes.

Wood noted that such fast-tracking of a mega IPO into major indices is unprecedented in the US market and could force passive funds to accumulate the stock regardless of valuation concerns.
The development is also relevant for Indian investors.The Nasdaq-100 includes some of the world’s largest technology companies, such as Apple, Microsoft, Nvidia, Amazon, Alphabet and Meta. If SpaceX joins the benchmark, Indian investors holding Nasdaq-100-linked mutual funds could gain indirect exposure to the aerospace and satellite communications giant.

India currently has five mutual fund schemes tracking the Nasdaq-100 Total Return Index, including offerings from Axis Mutual Fund, ICICI Prudential Mutual Fund, Motilal Oswal Mutual Fund and Navi Mutual Fund.

However, fresh investments into several overseas index funds remain restricted after fund houses approached regulatory overseas investment limits.

SpaceX has already generated strong investor interest ahead of its listing. Reports suggest demand has exceeded the number of shares on offer, while the company is expected to rank among the 10 most valuable listed firms in the US from day one.

For investors, the combination of a record IPO and potential early index inclusion means the stock could see a second wave of demand soon after listing, driven not by active investors but by passive funds mandated to replicate benchmark weights.