Risk Markets Rocked As North Korea Fires Missile Over Japan

Geopolitical Tensions Rise

Global risk appetite was shaken over the European morning in response to reports that North Korea fired a missile which passed over Japan. This marks the latest in a series of missile launches and marks an escalation in tension. NHK, a Japanese broadcaster, reported a government warning that a missile was headed toward the country’s northern region of Tohoku and that no action was being taken to shoot the missile down. According to reports, the missile fragmented into three parts and fell into the sea.

Reports were met with swift movement in currency and equities markets as the Dow Jones traded lower by over a 100 hundred points and the Yen rallied as investors bought the safe haven currency. Responding to the attack, the Chief Cabinet Secretary Yoshihide Suga said that “This ballistic missile launch appeared to fly over our territory. It is an unprecedented, serious and grave threat to our nation”.

Fire & Fury

The missile is the first to fly through Japanese airspace since 1998 and happened despite President Trump warning the reclusive nation that further missile launches would be met with “fire and fury”. The US and South Korea have been conducting joint military exercises as part of their annual exercises. The US Department of Defense said that it is still assessing the situation regarding the missile launch but judged that it did not pose an immediate threat to the US. Meanwhile, the Japanese government has been advising people in Tohoku to take shelter in underground shelters or solid buildings.

Responding to the missile, Japanese PM Abe said – “This reckless act of firing a missile over our nation is an unprecedented, serious and significant threat, one that seriously diminishes the peace and safety of the region, and as a result we have lodged a firm protest against North Korea.”  The Japanese premier also added that Under the firm Japan-U.S. Alliance, so that we can deal with any circumstance, while maintaining a sense of tension, we will do our utmost to ensure the public’s safety.