Precious Metals Pressured by Stronger US Dollar

Gold and silver prices faced downward pressure, largely attributed to a strengthening U.S. Dollar that was bolstered by robust American economic data. Gold dropped to the $4,690 level as the stronger greenback and elevated oil prices fueled inflation worries, while silver also saw a significant reversal, falling over 3% during trading sessions.

Mixed Geopolitical Signals from the Middle East

The market digested conflicting geopolitical developments from the Middle East, influencing overall sentiment. Reports of an extended ceasefire between Israel and Lebanon were followed by news that the U.S. is developing contingency plans to target Iranian capabilities in the Strait of Hormuz if a separate ceasefire fails. These geopolitical factors, alongside higher oil prices, were cited as weighing on business sentiment in regions like Hong Kong.

Diverging Economic and Policy Paths in Asia

Central banks across Asia are implementing varied strategies in response to local economic conditions and external pressures. Bank Indonesia and the Bangko Sentral ng Pilipinas have adopted more hawkish stances to support their currencies amid shocks from oil prices, while South Korea's economy saw a significant GDP surge driven by strong exports. In contrast, Japan's core inflation remained below its central bank target, and other key ASEAN economies' external deficits were seen as manageable despite higher energy costs.