Gold is heading for its worst weekly performance in over four decades , as escalating Middle East tensions drive higher oil prices, rising bond yields, and a stronger US dollar , eroding demand for the non-yielding asset. Sharp Selloff Driven by Rate Expectations Gold prices dropped sharply, with bullion falling over 3% to around US$4,509 per ounce , marking an eight-day losing streak . The key driver has been a shift in monetary expectations: Markets now see a 50% probability of a rate hike by October Expectations for rate cuts have diminished significantly Higher interest rates reduce gold’s appeal, as it does not generate yield , making it less attractive compared to bonds and cash. War Escalation Fuels Inflation and Dollar Strength The ongoing conflict in the Middle East — including potential US ground troop deployment and increased military presence — has pushed energy prices higher , reinforcing inflation risks. As a resu...
Maybank Research has downgraded its outlook for Southeast Asia, warning that rising energy prices and supply disruptions linked to Middle East tensions are triggering a stagflationary shock across the region. Growth Forecasts Lowered Across ASEAN-6 The research house now expects ASEAN-6 GDP growth at 4.5% in 2026 and 4.7% in 2027 , down from previous forecasts of 4.8%. The biggest downgrades were seen in: Philippines and Vietnam (-0.4ppt) Thailand (-0.3ppt) The revisions reflect the growing impact of higher energy costs and supply chain disruptions on economic activity. Inflation Pressures Intensify At the same time, inflation forecasts have been revised upward: 2026 inflation: 2.7% (vs 2.2% previously) 2027 inflation: 2.7% (vs 2.5%) The largest inflation increases are expected in Thailand, the Philippines, and Indonesia , driven by higher fuel and commodity prices. Monetary Policy Shift: Easing Cycle Disrupted The energy shock is expected...