-
Increased risk premium hits majors as Middle East tensions flare up
Major markets are responding this morning with risk appetite shifting negative as geopolitical tensions have ratcheted up several notches in the Middle East. The US has killed a key Iranian General as a result of attacks on the US Embassy in Baghdad, Iraq. Quite how this ultimately plays out in the region is yet to be seen, but the rhetoric is likely to be strong along with the prospect of retaliatory action. A risk premium is being priced into assets such as oil, but also we see safe havens benefitting. The US 10 year Treasury yield is -5bps at three week lows, whilst gold has accelerated its rally, and the yen is ... (full story)