The yen and franc give back their earlier gains as markets see some calm
The major theme engulfing the market landscape right now continues to be US-Iran tensions but after US president Trump played down the latest escalation by Iran, markets have responded with more calm for the time being.
USD/JPY fell to a low of 107.65 on headlines of the Iranian missile strikes but has now climbed back up to 108.35. USD/CHF is also back up to 0.9700 from 0.9665 earlier today.
Overall, markets are still leaning more towards a defensive posture but the situation isn't as dire as initially diagnosed earlier in the day. Bonds are still bid but have gave up majority of its gains while equities have pared heavy losses from the early morning moves as well.
Gold and oil have also given up some of their earlier gains in response. The former rose above $1,600 but is now settling just under there as we look to begin European trading.
Market participants are pretty much waiting on Trump's response now and we will have to see whether that involves further military retaliation or a more measured reply to Iran.
As such, major currencies are very much caught in the eye of storm - waiting either on the dark clouds to dissipate or for more disaster to strike in the coming hours.
