US-Iran Deal Sparks Broad Market Shift

A framework agreement between the United States and Iran aimed at ending the conflict in the Middle East has triggered a significant risk-on shift across global markets. This geopolitical de-escalation has caused a broad-based weakening of the US Dollar as its safe-haven demand fades, with oil prices also retreating on optimism over normalized supply flows through the Strait of Hormuz. Analysts note that while some institutions remain on alert, the development is viewed as a potential stabilizing force for the global economy.

Gold and Silver Surge on Weaker Dollar

Precious metals rallied strongly, with gold climbing over 3% and silver gaining nearly 4% as the market digested the geopolitical news. This surge, a reversal of underperformance seen during the recent conflict, is attributed to a weaker US Dollar and lower oil prices, which can reduce pressure for more aggressive monetary policy tightening. Silver's rebound is also supported ahead of the upcoming Federal Reserve meeting.

Central Bank Policy Remains in Focus

Despite the improved risk sentiment, investors remain highly attuned to global central bank policy divergence and incoming economic data. A poll indicates the Swiss National Bank is expected to keep its policy rate at 0%, while markets are also focused on the Bank of Japan and the US Federal Reserve. Softer US data, including downbeat industrial output and a drop in homebuilder sentiment, is also being factored into the monetary policy outlook.