Geopolitical Tensions Drive Market Caution

Markets began the week with a cautious tone as traders assessed developments surrounding the US-Iran conflict and the uncertainty of ceasefire talks. This sentiment was reflected across global markets, contributing to a cautious mood in European equities and weighing on several Asian currencies.

US Dollar Eases Amid Shifting Risk Sentiment

The US Dollar Index declined for a third consecutive day, a move attributed in part to a temporary halt in military attacks between the US and Iran. Despite the pullback, some analysts noted that the dollar remains supported by elevated US real yields and expectations of a "high-for-longer" interest rate environment. Meanwhile, the Japanese Yen continued to trade near multi-year lows against the dollar, keeping markets alert for potential currency intervention by Tokyo.

Precious Metals Face Headwinds

Silver prices experienced downward pressure, declining as the renewed conflict between the US and Iran stoked fears of energy supply disruptions. In a similar direction, gold prices were also reported to have fallen in the Indian market at the start of the week.