The yield on the 10-year US Treasury note increased amid the ongoing conflict. Since tensions between the United States and Iran escalated at the end of February, the yield has risen from around 3.94 percent to 4.06 percent.

In addition, the US Dollar Index strengthened following the US attack on Iran. The index rose from around 97.6 last Friday to 99.1. This indicates stronger demand for the US dollar in global markets.

The rise in these two US financial indicators continues to pressure the rupiah in previous trading sessions. It shows that market participants are seeking the US dollar as a safe-haven asset, alongside gold.

However, the conflict has not fully driven investors to accumulate gold. Speculation about possible negotiations between the two sides had earlier caused gold prices to weaken.

In morning trading, global gold prices rebounded to around 5,170 US dollars per troy ounce, after falling to 5,080 US dollars yesterday afternoon. In the domestic market, gold is currently traded at around 2.81 million rupiah per gram. Meanwhile, the rupiah weakened further in morning trading to 16,925 per US dollar, reflecting continued pressure from global market sentiment.

On the equity market, the Jakarta Composite Index opened lower at 7,896. The index remains under pressure amid concerns over rising inflation, driven by potential supply disruptions and higher global crude oil prices.

The decline in Indonesia’s stock market is mirroring declines with corrections seen in most Asian stock markets during morning trading today.

Writer: Gunawan Benjamin (Economist, Islamic University of North Sumatra)