DOWNLOAD
Metrobank US-Iran Risk Index: Oil’s slippery rise
The resolution of the Middle East conflict remains iffy. Risk levels remain high
By Metrobank Research, Investment Counselor Department
Our US-Iran Risk Index settled at 135.5 on March 9, 2026, 5.7% higher than the previous day. The index has risen by 20% overall since the first bombs descended on Iran.
Trading kicked off with a high climb for oil prices, eventually breaching USD 100 per barrel and sustaining their upward trend since the conflict began. However, crude prices retraced their steps later in the day following statements from US President Donald Trump that the conflict may soon be over. The 10-year US Treasury yields followed suit, moving lower as inflation expectations were pulled back.
Still, Brent oil prices settled higher on a day-to-day basis at nearly USD 99 per barrel. Safe haven flows to the US dollar also strengthened the dollar index, indicating a highly cautious environment for investors.
Metrobank Research’s US-Iran Risk Index measures the amount of risk that the ongoing conflict presents to financial markets. It considers the general risk sentiment of investors and inflationary pressures brought about by the conflict. A value of 100 denotes a normal level of risk based on market levels prior to the conflict’s escalation, while values greater than 100 imply increasing levels of risk.
What now?
| Asset Class | Outlook | Strategy |
|---|---|---|
| Local Fixed Income | Bearish | Stay defensive on duration and focus on short‑to‑belly tenors with good liquidity. Add positions only during yield spikes or market dislocations. Avoid aggressive moves until geopolitical risk premiums ease. |
| Local Equities | Bearish | Expect bargain-hunting of cheaper names in the near-term. However, gains may remain capped amid oil volatility and developments in the Middle East. Buy on dips and take profit in rallies. |
| Global Fixed Income | Bearish | Position in short-dated (up to 5 years) quality bonds as inflation fears add upward pressure on yields. Expect volatile swings as headlines drive market sentiment amid uncertainty. |
| Global Equities | Neutral | Maintain a defensive approach by prioritizing high dividend sectors while taking advantage of volatility to accumulate select quality growth names. |
| USD/PHP | Bullish | Buy US dollars on dips or close to support levels at 59.40 and 59.00. Oil prices and safe-haven flows will pressure the peso, though positive news that affect local and global inflation expectations offer potential relief. |
| G10 Currencies / US Dollar | Bearish | The latest bout of volatility has validated the US dollar’s safe haven status yet again. Continued and escalating conflict will favor the US dollar. However, G10 currencies will recover once risk sentiment improves. Domestic factors will determine the scale of the impact on G10’s respective forex rates. |
| Gold | Bullish | While initially reaching highs of USD 5,400 per troy ounce on safe haven demand, gold has pared gains after higher oil prices sparked expectations of more elevated US inflation, delayed Fed rate cuts, and a stronger US dollar. Still, the precious metal continues to be supported at the USD 5,000 / USD 5,100 level, and our long-term view is steady price appreciation as global central banks purchase gold to diversify reserves beyond the US dollar and US Treasuries. |
(Disclaimer: This is general investment information only and does not constitute an offer or guarantee, with all investment decisions made at your own risk. The bank takes no responsibility for any potential losses.)