Middle East Tensions Drive Market Uncertainty

Geopolitical developments between the US and Iran are dominating market sentiment, with conflicting reports of an extended ceasefire alongside continued military warnings from Iran. The situation has created uncertainty around the Strait of Hormuz, where the US is reportedly continuing a blockade of Iranian ports while also taking financial measures to weaken Iran-backed militias in Iraq.

US Dollar Strengthens on Safe-Haven Flows

The US Dollar Index firmed near a one-week high as investors sought safety amid doubts over the durability of the US-Iran ceasefire. This strength was evident against other major currencies, while the People's Bank of China also set a weaker reference rate for the yuan against the dollar.

Precious Metals Show Divergent Moves

Gold prices declined as renewed tensions in the Strait of Hormuz were reported to be stoking inflation concerns, which could imply a more aggressive central bank response. In contrast, silver attracted buyers during the Asian session, rebounding from a one-week low to trade around the $77.50 level.