Safe-Haven Surge: Yen and Bonds Rally Amid Russia-Ukraine Tensions

Investors turned to safe-haven assets as tensions escalated between Russia and the United States over Ukraine. Government bonds and the Japanese yen surged after President Putin updated Russia's nuclear doctrine. The market responded with falling bond yields and rising demand for safe currencies like the yen and the Swiss franc.

On Tuesday, global markets witnessed a surge in safe-haven assets, with government bonds and the Japanese yen leading the charge. This shift was triggered by escalating geopolitical tensions after President Vladimir Putin unveiled changes to Russia's nuclear doctrine, escalating the conflict between Russia and the United States over the situation in Ukraine.

Government bond yields fell as investors sought safer investments. In the U.S., the 10-year Treasury yield dropped by five basis points to 4.3648%, while Germany's 10-year yield decreased by seven basis points to 2.303%. The Japanese yen climbed 0.6% against the dollar, highlighting its status as a go-to asset during turbulent times.

European shares also felt the impact, with the STOXX 600 index experiencing losses. Market analysts pointed to a report that Ukraine had used an ATACMS missile inside Russia, further fueling market jitters. Investors are now keenly awaiting the appointment of the new U.S. Treasury Secretary, with potential candidates under consideration.

(With inputs from agencies.)