Gold prices jumped, with futures for December delivery trading 0.86 percent higher at $1,273.40 per ounce.
North Korea's military threatened Wednesday to launch an intermediate-range ballistic missile attack on "areas near Guam" in order to contain the USA military's strategic assets based on the Pacific island.
The Swiss franc, another currency that draws demand in times of geopolitical anxiety, strengthened 0.6 percent to 0.9682 francCHF= to pull away from two-month lows of around 0.9770 set the previous day.
"We likely will continue to see more tension in the region (Korean Peninsula)", Meir noted. Korea's Kospi SEU, -1.10% stock benchmark lost 1.1% while US stock futures were losing ground ahead of Wednesday's open.More news: Bachelorette Finale: How long is this relationship going on?
The dollar weakened against the yen, which is often sought in times of geopolitical tension. The 10-year German bund yield traded at 0.43 percent while the 10-year USA yield declined to 2.243 percent.
The euro was 0.45 percent weaker at 129.125 yen EURJPY= and the Australian dollar slipped 0.7 percent to 86.66 yen AUDJPY=.
The Pentagon's statement never mentioned North Korea or Kim (or Trump, for that matter) by name, but the tiny tyrannical fiefdom's specter hung over the exercise.
Risk sentiment receded, driving down U.S. Treasury yields which in turn weighed on the dollar.More news: Swanky San Francisco Street Sells for $90K, Spurring Suit
U.S. Treasury yields fell on Wednesday, with yields on the benchmark 10-year note hitting a six-week low, as investors reached for safe-haven assets such as government debt.
The euro edged down 0.1 percent to $1.1735 EUR=.
The kiwi has been on the back foot all week ahead of the Reserve Bank of New Zealand's (RBNZ) policy decision due on Thursday, when it is widely expected to keep interest rates unchanged at a record low 1.75 percent. The EUR/JPY was down 0.54% to trade at 128.924 Yen while the GBP/JPY was down 0.58% to trade at 142.489 Yen.More news: Iranian Drone Forces US Plane to Take Evasive Action