Asia Shares Slide as Oil Prices Climb and Bond Yields Remain High Amid US-Iran Tensions

Asian shares declined on Monday as tensions between the United States and Iran escalated, sending oil prices higher.

The Brent crude price rose by around 1.4% to $89-$90 a barrel after US forces struck Iranian launchers on Larak Island, triggering geopolitical risk premiums.

Federal Reserve Chair Kevin Warsh emphasized that the central bank still has 'work to do' on inflation, which lifted expectations for a rate hike and sent two-year U.S. Treasury yields to their highest levels in a month.

Markets now assign over 50% probability to a September rate increase, although some analysts favor a December hike unless incoming payrolls and CPI data weaken.