23/03/2026

BIZ & FINANCE MONDAY | MAR 23, 2026

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Gold caught in transition phase, says analyst

CPO seen firm on West Asia conflict, rubber tipped to move sideways

KUALA LUMPUR: Crude palm oil (CPO) futures on Bursa Malaysia Derivatives are expected to trade with an upward bias this week amid the conflict in West Asia. Iceberg X Sdn Bhd proprietary trader David Ng said the conflict has pushed energy prices higher, lending support to sentiment on palm oil. “The ongoing war involving Iran, the United States and Israel is driving oil prices higher, which is supporting palm oil sentiment in the market. “We see prices ranging between RM4,450 and RM4,680 (per tonne) this week,” he told Bernama. In contrast, Interband Group of Companies senior palm oil trader Jim Teh said the market is expected to turn bearish this week amid a shortened trading period due to Aidilfitri celebrations. Teh said the market will likely see profit taking activities, with prices moving in the RM4,100-RM4,200 level due to higher energy prices and logistics disruption in West Asia amid the ongoing conflict, while speculators may enter the market to take advantage of price movements. “There will be some logistical disruption to West Asia because of the war that is going on to make the speculators come in and speculate on the prices,” he said. On stock levels, he said Malaysia currently has ample palm oil inventories, while demand is still expected from key importers such as China, Pakistan, India, the European Union and the United States. The market was closed on Friday for the additional Hari Raya Aidilfitri public holiday. On a Friday-to-Thursday basis, the April 2026 contract jumped RM41 over the week to RM4,580 per tonne. The physical CPO price for April South increased by RM100 to RM4,600 a tonne. Meanwhile, the rubber market is expected to trade sideways with a slight upward bias amid as the market keeps a close watch on uncertainties surrounding the ongoing West Asia conflict, said industry expert Denis Low. He said the conflict is beginning to weigh heavily on global industry, commerce and overall economic stability. However, he said the immediate impact on rubber demand is being partially offset by slower global consumption. “For the moment, the resulting shortage is equalised by weaker demand because of the war. This creates a temporary balance, but uncertainty remains high.” Low also pointed out that the extended Aidilfitri holiday break is likely to dampen trading activity in the short term. On a Friday-to-Friday basis, the Malaysian Rubber Board’s reference price for Standard Malaysian Rubber 20 declined 26.5 sen to 758.5 sen per kg while latex in bulk surged 12 sen to 677 sen per kg.

KUALA LUMPUR: Gold prices are currently under pressure due to market liquidation, rising real yields and temporarily delayed physical demand, rather than a breakdown in the long-term macroeconomic outlook, according to an analyst. SPI Asset Management managing partner Stephen Innes ( pic ) said gold is currently caught in a transition phase as investors misread the broader macroeconomic “endgame”, or the eventual shift towards monetary policy easing, Bernama reported. “We are not operating in a low o Market misreading of monetary ‘endgame’ putting pressure on precious metal: Stephen Innes According to Innes, higher interest rates have intensified pressure across credit markets, equities and economic growth, particularly in a global financial system heavily reliant on debt and leverage. “The longer rates stay restrictive, the more pressure builds in credit, equities and growth, and that is exactly the setup that eventually forces the pivot,” he said. Innes said once monetary policy pivots and yields begin to decline, gold is expected to regain strength as investors return to the precious metal as a hedge against economic uncertainty. “Gold is not failing. It is being liquidated in a market that is misreading the endgame,” he said. Earlier on Saturday, Turkiye’s state-run news agency, Anadolu Agency, reported that the price of gold saw its biggest weekly drop since 1983, falling more than 10% to below the US$4,500 (RM17,700) threshold on Friday. Still on gold, OCBC Group Research, in a recent note, stated that elevated geopolitical risks, policy uncertainty, and concerns about global growth have historically supported demand for gold as a defensive asset. The firm said that, at the same time, continued central bank diversification into gold and a broader base of investor participation should continue to provide a debt, high-flexibility world. We are operating in a balance-sheet-heavy system where tightening works quickly and breaks things quickly. The market is still clinging to the idea that central banks can hike with impunity, as if this system can absorb higher rates without con sequence,” he said in a note.

OCBC Group Research says current financial and monetary environment creates tension for gold. – BERNAMAPIC structural support for gold. “On the other hand, the

The report also indicated that the Bank of Korea signalled plans to resume investing in a physical gold exchange-traded fund, marking its first purchase of a gold-related financial product since 2013. “While there were earlier chatters that Poland (the biggest official sector purchaser of gold on reported terms in 2025) planned to use unrealised profit on gold reserves to finance military spending, this was later refuted by National Bank of Poland governor Adam Glapinski, adding that the government has expressed ‘zero interest’ in the proposal,” the research firm said. Looking ahead, OCBC Group Research said gold is often seen as a beneficiary of stagflation (an environment of slowing growth, persistent inflation and high unemployment), but the relationship is not always straightforward. The firm said that historically, gold has tended to perform well when inflation is elevated and growth weakens, particularly when real yields decline and confidence in the policy framework deteriorates. However, the experience in 2022 (Russia Ukraine war) illustrates why the details matter. “Despite rising inflation and mounting recession concerns (conditions that are often associated with stagflation), gold prices actually declined for much of that year as the Fed tightened policy aggressively, pushing real yields sharply higher. “In other words, it is not stagflation per se that drives gold, but that the path of real rates matters. “When inflation rises, but central banks respond forcefully, and real yields move higher, the opportunity cost of holding gold increases and gold prices can come under pressure,” OCBC Group Research said.

narrative can be challenging for gold in the near term. A sharp rise in energy prices risks reigniting inflationary pressure. “If inflation proves more

persistent, monetary easing could be delayed or reversed. In such a scenario, nominal yields and real interest rates would likely stay elevated, tightening global financial conditions and, in turn, setting an unfavourable environment for gold bulls,” the bank-backed research firm said. As a result, OCBC Group Research said, the current environment creates tension for gold. “While demand for safe-haven stays intact, rising real yields and stronger demand for dollar liquidity could limit the upside for gold in the near term. “This also explains why gold has largely traded range-bound, following the decline in gold prices on the onset of the US/Israel-Iran war,” the research firm said. OCBC Group Research also said that while the broader buying trend remains, the pace of purchases moderated in January. According to data compiled by World Gold Council and central banks bought a net five tonnes in January (versus a monthly average of 27 tonnes in 2025). Some of the top sellers were Kazakhstan and Russia, while Uz bekistan was among the top buyers. Data also showed a broadening of the demand base, with Bank Negara Malaysia making its first net purchase since 2018 and Bank Indonesia adding to gold purchases. China has continued its gold-buying streak for the 16th straight month in February, OCBC Group Research said.

Trading on Bursa Malaysia expected to remain volatile KUALA LUMPUR: Trading on Bursa Malaysia is expected to continue to be volatile this week after the Hari Raya Aidilfitri break, although the broader trend still points to a gradually rising momentum. disruption, with the key risk lying in the pace of the increase.

the ongoing West Asia conflict. On a Friday-to-Thursday basis, the FBM KLCI rose 21.86 points to 1,720.71 from 1,698.85 a week earlier. Weekly turnover fell to 11.88 billion units worth RM14.56 billion. Main Market volume fell to 7.41 billion units worth RM13.74 billion and ACE Market volume declined to 1.07 billion units valued at RM392.27. Bursa Malaysia and its subsidiaries is closed today and will resume operations tomorrow).

19, 2026, the trend suggests that a sharp spike in oil prices could drag the index lower by around 2% to 2.5%, as higher energy costs weigh on sentiment and tighten financial conditions,” he added. “In a more adverse scenario, Brent crude could move towards the US$120 to US$130 per barrel range, with Asia particularly exposed to supply disruptions.” Mohd Sedek said markets have shown an ability to absorb a gradual rise in oil prices without significant

geopolitical tensions during the extended holiday period from Friday to Monday could trigger a temporary spike in oil prices. However, if tensions ease before markets reopen on Tuesday, the overall impact on Bursa Malaysia is likely to remain contained,” he told Bernama. He reiterated that the market remains sensitive to abrupt movements in energy prices. “Tracking the daily pattern of the FBM KLCI from Feb 27, 2026, to March

“A sudden spike could quickly lift inflation expectations, trigger policy repricing, and reverse capital flows. As such, while the near-term outlook remains cautiously constructive, it remains contingent on stable energy markets and no further escalation in geopolitical tensions.” For the week just ended, Bursa Malaysia traded mixed, tracking the regional market performance amid

IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said the key drivers remain oil prices and developments in West Asia, with sentiment likely to stay highly event-driven. “Notably, any escalation in