Safe Haven Demand

 

Middle East Tensions Increase Demand for Safe Haven Assets

Escalating geopolitical tensions in the Middle East are driving investors toward safe haven assets such as gold and strong currencies, including the US dollar (USD), Japanese yen (JPY), and Swiss franc (CHF). Rising global uncertainty has pushed market participants to seek assets that can preserve value during periods of volatility.

According to data from Trading Economics, gold prices declined slightly on Monday (March 9) at 15:56 WIB, falling 1.25% on a daily basis to US$5,094.12 per troy ounce.

Meanwhile, the US Dollar Index (DXY) stood at 99.51, marking a 2.83% gain over the past month. In the foreign exchange market, the USD/JPY pair climbed to 158.65, up 2.76% in a month, while USD/CHF also strengthened 1.61% over the same period to 0.78.

Sovereign Bonds Remain a Key Safe Haven Option

Beyond gold and major currencies, HFX International Berjangka President Commissioner Sutopo Widodo highlighted several alternative safe haven assets. According to him, sovereign bonds are often the primary choice for large institutional investors when uncertainty increases.

Government bonds such as US Treasuries or debt issued by countries with AAA credit ratings, including Germany’s Bunds and the United Kingdom’s Gilts, are widely considered to carry nearly zero default risk.

“When stock markets become volatile, large capital flows usually move into these assets to protect the principal value of investments while still earning fixed returns,” Sutopo told Kontan on Monday (March 9, 2026).

Precious Metals Like Silver and Platinum as Diversification Tools

Sutopo also emphasized the importance of precious metals such as silver in portfolio diversification. Although silver tends to be more volatile due to its industrial demand, it often maintains a strong positive correlation with gold during periods of currency devaluation.

In addition, platinum can also serve as an alternative investment. Its rarity even exceeds gold, although the market is much smaller and heavily influenced by demand from the automotive industry.

Defensive Stocks and Real Assets Offer Stability

According to Sutopo, defensive sectors such as Consumer Staples, Utilities, and Healthcare stocks typically remain stable during economic or geopolitical turmoil. Companies in these industries provide essential products and services that remain in demand regardless of inflation or geopolitical tensions.

Furthermore, land and property can serve as one of the most resilient long-term wealth storage options.

“Unlike currencies that can be diluted by inflation, land is a finite asset with continuously growing demand. In extreme economic conditions, owning real assets provides peace of mind because their value will never drop to zero,” Sutopo explained.

Gold, USD, JPY, and CHF Still Considered Primary Safe Havens

Meanwhile, Doo Financial Futures commodity analyst Lukman Leong noted that gold, USD, JPY, and CHF have long been recognized as traditional safe haven assets. Other assets often depend on individual investor preferences since there is no universal consensus.

Some investors consider Bitcoin, the Singapore dollar (SGD), and the Norwegian krone (NOK) as alternative safe haven assets.

“In my view, gold, USD, CHF, and JPY remain the primary safe havens, although their characteristics can change depending on market developments,” Lukman said.

However, Lukman believes that silver and other commodities are less suitable as safe haven assets because they tend to be too volatile during market uncertainty.

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Gold Awaits NFP

Gold Awaits US Nonfarm Payrolls for Clear Direction

Gold prices rebounded above $5,100 on Friday morning after testing the $5,050 level amid a global sell-off. The US dollar retreated as investors took profits ahead of the crucial US February labor market data. Meanwhile, the 21-day Simple Moving Average (SMA) remains supportive, while a daily close above the 61.8% Fibonacci retracement level is considered critical for gold buyers.

Short-Term Outlook Remains Mildly Bullish

In the short term, the outlook for gold remains slightly bullish as prices continue to hold above the 21-day SMA at $5,087 and well above the 50-, 100-, and 200-day SMAs, all of which are trending upward and reinforcing the broader uptrend.

The Relative Strength Index (RSI) is currently around 54, remaining neutral but still above the midpoint, indicating stable bullish momentum following the recent consolidation from the April peak.

Measured from the $4,402 low to the $5,598 high, gold is currently oscillating near the 61.8% Fibonacci retracement level at $5,141, suggesting buyers are attempting to defend this key pullback zone within the prevailing bullish structure.

Initial support appears at $5,141, the 61.8% retracement level, with the 21-day SMA near $5,087 reinforcing this demand area. A daily close below this zone could expose the 50% retracement level at $5,000, where dip-buying interest is likely to be tested.

Further downside support is seen at the 38.2% retracement near $4,859, followed by the broader trend base around $4,684.

On the upside, immediate resistance is located near $5,235, aligned with last week’s high. The next key barrier lies at the 78.6% Fibonacci retracement around $5,342. A breakout above this level could open the door for a retest of the record high near $5,598, reaffirming the dominant bullish trend.

Weaker US Dollar Supports Gold Recovery

Gold prices regained strength above $5,100, showing signs of renewed momentum as the US dollar weakened due to profit-taking ahead of the highly anticipated US employment report.

A moderate pullback in oil prices also supported gold’s early Friday recovery. The decline followed assurances from the Trump administration that it is considering various measures to address the recent surge in oil and gasoline prices amid the ongoing conflict in Iran.

Oil prices had surged on Thursday, triggering a “sell everything” wave in global markets as investors feared rising inflation and its potential impact on the global economy. The US dollar emerged as the top-performing asset, as investors sought safety in the world’s reserve currency, which temporarily reduced demand for gold as a safe-haven asset.

The greenback was also supported by renewed hawkish expectations regarding the Federal Reserve’s monetary policy outlook, driven by concerns about persistent inflation. Meanwhile, US Treasury yields also climbed, creating additional headwinds for gold, which typically performs better in a low interest rate environment.

Market Focus Shifts to US NFP Data

Looking ahead, gold markets are awaiting the US February employment report, particularly the Nonfarm Payrolls (NFP) figure, for a clearer directional breakout.

Economists expect US NFP to increase by around 60,000 in February, following a 130,000 gain in January. The unemployment rate is forecast to remain steady at 4.3%.

A reading below 50,000 could revive dovish expectations for the Federal Reserve, providing a much-needed boost for non-yielding assets like gold.

Conversely, a stronger-than-expected NFP figure could reinforce the argument for fewer than two Fed rate cuts this year, or even push markets to price out rate cuts altogether—potentially putting significant pressure on gold.

However, market reactions to the NFP release could be quickly overshadowed by new developments in the Middle East conflict, which continues to add uncertainty to global markets.

According to Reuters, US Defense Secretary Pete Hegseth and Admiral Brad Cooper, who leads US forces in the Middle East, stated that the United States has sufficient ammunition to continue bombing operations indefinitely.

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Gold Prices Surge

 

Gold Prices Rise in Thursday Morning Trading (March 5, 2026)

Gold prices extended their gains in Thursday morning trading (March 5, 2026), supported by renewed buying interest amid ongoing geopolitical uncertainty.

As of 07:47 a.m. WIB, gold futures for April 2026 delivery on the Commodity Exchange were trading at US$5,182.30 per troy ounce, up 0.93% from the previous close of US$5,134.70 per troy ounce.

Gold Rebounds After Brief Correction

Gold resumed its upward momentum after a short correction, as buyers took advantage of lower price levels to re-enter the market. Persistent geopolitical tensions in the Middle East continue to strengthen demand for safe-haven assets.

According to Bloomberg, gold prices have climbed approximately 20% year-to-date, reaching an all-time high above US$5,595 per troy ounce at the end of January.

Geopolitical Tensions and Fed Concerns Support Gold

Strong demand driven by geopolitical risks and concerns over the independence of the Federal Reserve has played a significant role in pushing gold prices higher.

Peter Kinsella, Global Head of FX Strategy at UBP SA, stated that the recent sharp pullback, combined with bullish positioning from hedge funds and investment managers, should help limit further downside risks.

“I think we will definitely see a recovery in gold prices,” Kinsella told Bloomberg.

He added that the long-term drivers supporting gold remain firmly intact.

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