Asian share markets turned tail on Wednesday as fears over instability in the European Union returned with a vengeance, sending the pound to three-decade lows and hammering risky assets of all stripes, according to Reuters.
In frantic trading reminiscent of the fateful Friday after Britain voted to abandon the EU, sterling shed a full U.S. cent in a matter of minutes to crater at $1.2798 GBP=D4, Reuters reports.
Perhaps taking advantage of the distraction, Beijing allowed the yuan to fall to the lowest since late 2010 CNY=CFXS and secure a competitive advantage for its exports.
Concerns that central banks might not be able to soften this latest blow to global growth hit commodities hard. Having shed near 5 percent on Tuesday, Brent crude oil LCOc1 fell further to $47.84, with U.S. crude at $46.43 a barrel.
Spooked investors rushed into safe-haven sovereign debt and took markets deeper into unknown territory.
Yields on U.S. Treasuries, the benchmark for bonds worldwide, hit record lows out to 30 years. The 10-year note offered just 1.35% US10YT=RR and investors were willing to pay Japan 0.27% to lend Japan money for a decade.
”There`s no inflation prospects, there`s no strong growth. The only thing we have is uncertainty,” said Hiroko Iwaki, senior bond strategist at Mizuho Securities.