Iran warns of a strong response to new threats of attack from US President Donald Trump, who has expressed readiness to support attacks on Iran if it rebuilds its nuclear or missile programs. Iran has said it will respond "severely" if attacked again.
The president also issued a stern warning to Iran and Hamas after his meeting with Israeli Prime Minister Benjamin Netanyahu, signaling strong US support for military action if Iran continues to instigate conflict.

Israel's Concerns

Israel is now on alert for a possible attack from Iran and is ready to take tactical action in case of a surprise attack.

The Israeli military is reportedly preparing for a possible "surprise war" with Iran amid political tensions and protests in Iran.

Iran's Domestic Situation

In Iran itself, protests continue to escalate due to an economic crisis exacerbated by the conflict, including high inflation, a weakening currency, and the pressure of sanctions.

Iran is also facing a sharp economic crisis, with the rial falling sharply and living standards plummeting, fueling public anger and broader political instability.

Although a major war between Iran and Israel has not erupted again since 2025, relations between the two countries remain extremely tense. Military threats, harsh rhetoric, and the potential for further attacks from both sides continue to be the focus of international scrutiny.

Here's a brief and clear overview of the latest impacts of the Iran-Israel conflict on the global economy, the dollar exchange rate, and gold prices.

Update on the Impact of the Iran-Israel Conflict on the World Economy & Markets

The economic risks of Israel's Iran attack

Investors brace for oil price spike, rush to havens after US bombs Iran nuclear sites
Israel-Iran War Has Not Significantly Boosted Gold Prices
Defying History: Gold Prices Fall Amidst the Israel-Iran War

The Iran-Israel Conflict and Its Possible Impact on the Market

1. Rising Oil Prices & Global Inflation

Tension in the Middle East consistently impacts global oil supplies, as the region is a hub for global oil production and export routes. A threat to the Strait of Hormuz (a key oil export route) could drive oil prices up sharply, which in turn raises global energy costs and triggers inflationary pressures in many countries.

Rising oil prices could also depress economic growth in energy-importing countries, as production and transportation costs increase.

2. US Dollar & Safe-Haven Assets

When conflict escalates or geopolitical risks rise, investors often resort to flight to safety (shifting to assets perceived as safer):

The US dollar often strengthens in the short term because it is considered a safe asset during times of high global uncertainty.
Reuters

This can also weaken emerging market currencies, such as the rupiah, if global investors withdraw capital from assets perceived as risky.

However, the impact is not always large or permanent—it depends on whether the conflict subsides or escalates.

3. Gold: The Diversified Role of a Safe-Haven Asset

Gold traditionally rises when geopolitical tensions increase as investors seek safe-haven assets when stock markets and risk appetite rise. Some market reactions suggest gold could rise, especially when the risk of conflict is high.

However, during some phases of conflict, gold prices may not immediately spike sharply or stabilize at high levels, as investors can focus on other factors such as interest rates, the value of the dollar, or the overall global economic conditions.

4. Impact on the Global Economy & Markets

High oil prices can create inflationary pressure: This can increase the cost of goods and transportation worldwide.

Stock markets can decline temporarily as investors become anxious about uncertainty.

Energy-importing countries, such as Indonesia and many other countries that rely on imported oil, could experience further pressure.

Conflict increases global energy risks, particularly regarding oil.
Middle East Monitor

The dollar often strengthens as a safe haven, but its impact can fluctuate depending on the latest news.

Gold typically rises sharply during times of high uncertainty, but this is not always consistent.

Global inflation and currency exchange rates could be under pressure if the conflict spreads. (cay)

Source: Newsmaker.id