Fx analysts at Royal Bank of Scotland are recommending investors buy U.S. dollar calls against the Singapore dollar, Myanmar ringgit and Chinese yuan over expectations falling oil prices will weaken the currencies against the U.S. unit.

The analysts said in an Aug. 19 report they believe oil price was the dominant driver of the performance of regional currencies over the past 18 months, suggesting that rising oil prices have led to a strengthening of the regional currencies as a bloc against the U.S. dollar. They also noted regional currencies strengthened when their equity markets performed.

Woon Khein Chia, local markets strategist based in Singapore, said in the event of a reversal of oil prices, the majority of the Asian currencies would weaken against the greenback as they had earlier “benefited” from the negative impact of the oil price increase on the U.S. dollar. She believes among them, the most affected would be Singapore dollar. “If the oil price falls by 10% from its current level, this would lead to a