Yen Rises as Korea Tensions Escalate

Escalating geopolitical tensions sparked a rise in the yen, while most Asian equities advanced as investors assessed statements from China’s National People’s Congress and Federal Reserve Chair Janet Yellen.

The Topix and U.S. stock futures were lower as Japan moved to the highest possible alert level after North Korea fired four ballistic missiles into nearby waters. Equities were mostly higher elsewhere, with shares in Hong Kong and Shanghai advancing. The 10-year U.S. Treasury yield was steady after gaining for five straight days. Gold retreated with oil.

The latest provocation from Kim Jong Un’s regime comes as South Korea and the U.S. undertake annual military drills that Pyongyang has called a prelude to an invasion. Tensions have been rising over North Korea, which also conducted a missile test during Abe’s state visit to the U.S. last month and is suspected of being behind the assassination of its leader’s half brother in Malaysia.

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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.