US government bond saw a significant turnout from investors after US President Donald Trump announced his country’s withdrawal from the nuclear deal with Iran.
The yield on 10-year US Treasury bonds rose to a two-week high of 3.014 percent, as many investments flocked to the bond markets at the expense of commodities and safe haven currencies.
Gold prices fell 1 percent, recording the lowest levels in four sessions at $1304.27 an ounce, while the USDJPY pair soared 0.7 percent to hit a high of 109.79.
Trump's decision to pull out from the nuclear deal with Iran signed in 2015 has caused many concerns in the financial markets, especially as European countries are still in the agreement and are working to modify a number of items.
Under the accord, crude oil prices set a new high at $71.15 a barrel, the highest since late 2014, as the return of economic boycotts within 180 days of the US withdrawal from the agreement may work to cut oil supplies from Iran, the third largest producers in OPEC.
Markets interpreted Trump's withdrawal from nuclear deal with Iran as a sure decline in Iran's production, which picked up after sanctions were lifted in 2016.
Hence, a potential drop in Iran’s production combined with the undergoing OPEC pact to cut output have pushed oil prices higher.
The dollar index, which tracks the green currency movements versus a
basket of major currencies, resumed its rise for a fourth straight session to
93.25, the highest level since December 19, 2017.