Middle East Escalation Rattles Asia Markets on July 13
Iran-US strikes and Hormuz fears drove oil up 4%, sent Asian equities sharply lower, and shaped a volatile FX session across the Pacific.
Global markets opened the week under clear stress as a renewed wave of US strikes on Iranian targets — and Iran's retaliatory ballistic missile attack on Jordan — sent shockwaves through Asia-Pacific trading on July 13, 2026. Oil futures surged more than 3-4% at the Globex open, driven by fears that the Strait of Hormuz, one of the world's most critical energy chokepoints, could face sustained disruption. Gold, which typically benefits from geopolitical chaos, instead slid more than 1%, a counterintuitive move that analysts may link to a stronger dollar and Federal Reserve inflation warnings crowding out safe-haven demand.
Equity markets across the region absorbed the brunt of the risk-off sentiment. South Korean shares fell more than 5%, with profit-taking in semiconductor giant SK Hynix compounding the geopolitical anxiety. Japan's Nikkei also declined, while US and European futures pointed broadly lower, reflecting how completely the Middle East conflict had displaced other market narratives heading into the new trading week.
Read more Binance Expands Into Gold and Silver Options Trading →
On the monetary policy front, Goldman Sachs projected US core CPI would ease to 2.8% year-on-year in June — a figure that, if confirmed, would offer modest reassurance to rate markets, though the inflationary tail risk from an oil shock adds a meaningful complication. The Bank of Japan was separately reported to be holding rates steady at its upcoming meeting while potentially raising its 2026 growth forecast, suggesting Tokyo remains cautious about tightening into a fragile global environment.
Meanwhile, Angola's decision to add the Chinese yuan to its official bank reserve currency options alongside the dollar and euro offered a quiet but telling signal about how emerging markets are diversifying away from dollar-centric frameworks as Beijing's bilateral ties deepen. China's independent "teapot" oil refiners also shifted purchases toward Qatari, Iraqi, and UAE crude, apparently distancing themselves from Iranian supply amid the heightened volatility. New Zealand provided a rare bright spot, with its services PMI returning to expansion at 50.6 in June.
Continue reading at Forexlive
