Sterling was up against the euro and the US dollar, after the US president warned North Korea faced “fire and fury” from their attempts to build nuclear weapons that could reach America.
The escalating tensions last night sent worries through US stock markets, with stocks in Asia also plunging overnight.
As a result, Europe was flashing red today, with Britain’s top stock index the FTSE 100 falling around 0.8 per cent to 7,480.
Safe havens such as gold jumped, with the precious metal price up almost one per cent, investors also piled into US bonds and the Swiss Franc.
North Korea has responded to Mr Trump’s comments by threatening missile strikes on the US Pacific territory of Guam.
With little economy news expected today, headlines around the US president and the North Korea leader are likely to keep driving markets.
Escalating tensions between the US and North Korea – with the latter threatening an airbase in Guam following the former’s heightened rhetoric – seriously spooked the European indices after the bell.
Tomorrow looks to be a key day for UK data. We have the industrial, manufacturing and construction data in the morning which all play a key part towards the UK growth. Also, the UK Trade balance data. Usually in previous months we have seen that this data is normally a market mover.