Gold rises to highest level in almost two months, while Swiss franc increases by more than 1% against US dollar
Growing tension between the US and North Korea boosted the Swiss franc, the Japanese yen, gold and government bonds as investors sought out traditional safe havens at a time of geopolitical uncertainty.
Nervous trading marked the 10th anniversary of the start of the financial crisis on Wednesday, after Donald Trump’s warning that North Korea faced “fire and fury like the world has never seen” if it continued to make threats against the US.
Gold rose to its highest level in almost two months, while the Swiss franc increased by more than 1% against the US dollar and saw its biggest one-day gain against the euro in more than two and a half years. South Korea’s won currency dropped 0.9% against the dollar.
Kathleen Brooks, research director at City Index Direct, said: “The Swiss franc is the safe haven of choice today as risk sentiment gets hit from escalating nuclear fears between the US and North Korea. Unsurprisingly, the yen, which is still the second best performer in the G10 foreign exchange space, is playing second fiddle to the Swiss franc due to Japan’s proximity to the epicentre in Pyongyang.”
Shares fell in Asian and European trading after Pyongyang responded to the US president’s tough language with a threat to launch a nuclear strike on the US Pacific territory of Guam.
