Ukraine crisis may prove wild card for inflation-obsessed world markets

Top-rated government bonds and gold, assets that typically rally when political upheaval or war threaten, fail to gain in flare up.

With surging inflation and central bank policy occupying investors' minds, the traditional market playbook on how to react to military flare-ups has been thrown out of the window.

Unease over Russia's troop build-up near the Ukraine border contributed, alongside U.S. rate-hike jitters, to a 5% slide on Wall Street last month. Yet top-rated government bonds and gold, assets that typically rally when political upheaval or war threaten, failed to benefit.

U.S. and German bonds - considered the safest assets of all - witnessed their worst month since early 2021, with yields surging 30 and 20 basis points respectively as inflation and the