Iran-US conflict will hurt global economy: Govt

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Pimchanok Vonkorpon, director-general of the Trade Policy and Strategy Office, has warned of economic impacts on the Iran-US conflict. (Photo supplied)
Pimchanok Vonkorpon, director-general of the Trade Policy and Strategy Office, has warned of economic impacts on the Iran-US conflict. (Photo supplied)

The conflict between Iran and the United States will lead to fluctuations in currency and stock markets and an immediate rise in the price of oil and gold, the Commerce Ministry has warned.

Pimchanok Vonkorpon, director-general of the ministry’s Trade Policy and Strategy Office, issued the warning in the wake of the US assassination of Iranian top general Qasem Soleimani on Friday.

“The incident will impact the macroeconomy and cause fluctuations in currency and stock markets,” she said.

Miss Pimchanok said oil prices soared nearly 4% on Friday and were likely to rise further unless the situation was relieved.

“Besides, the incident will prompt investors to hold low-risk assets and cause price of gold to rise,” she said.

In the medium and long terms, the incident would have a negative impact on investors’ confidence and slightly affect the global economy, Miss Pimchanok said.

However, the overall global economy should improve from last year based on positive factors including progress in trade deals between China and the US and economic stimulus measures in many countries, she said.

Assessing downside risk, Miss Pimchanok said if Iran and the US retaliated against each other and the Strait of Hormuz was closed, the oil price would increase and cargo transport would be affected. About 20% of global marine oil shipments pass through the Strait of Hormuz, she said.

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