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Haven assets such as the Japanese yen, gold and government bonds haves spiked in Asia, and equities have turned south on breaking reports the US launched a missile strike on Syria in response to a gas attack there this week that claimed the lives of more than 70 people.
The yen was up 0.2 per cent at ¥110.57 per dollar, swinging from losses before news of the strike broke on the wires. The currency, often regarded as a haven asset, soared as much as 0.4 per cent.
Similarly, gold erased early declines and was up 0.6 per cent at an intra-day high of $1,260.63 an ounce.
The yield on the 10-year US Treasury tumbled 3.6 basis points to a four-and-a-half-month low of 2.3051 per cent. Yields move in the opposite direction to price.
The dollar index, a measure of the US currency against a basket of global peers, was up 0.1 per cent at 100.72.
Equities around Asia were pulling back sharply. Japan’s Topix was up 0.3 per cent, erasing a gain of as much as 1.2 per cent, while Australia’s S&P/ASX 200 swung into negative territory, down 0.1 per cent.
Donald Trump this week said the chemical weapons assault in northern Syria had changed his attitude towards the regime of President Bashar al-Assad, but did not say how this would affect US policy.
“What happened yesterday is unacceptable to me,” the president said of the Syria gas attack during a press conference with King Abdullah II of Jordan. He said the attack had crossed “many, many lines — beyond a red line”.
Mr Trump blamed the suspected chemical attack on the Assad regime, but declined to say how the US would respond. “You will see,” he said.
The sudden launch of more than 50 tomahawk missiles at Syria also appears to be a break with Mr Trump’s publicly stated position on the need for approval of such an attack. In August 2013 he tweeted, “The President must get Congressional approval before attacking Syria-big mistake if he does not!”