Donald Trump believes Iran is standing down, following missile attacks on Iraqi air bases housing US and coalition troops. Tradefair brings you the latest from US politics...
Iran appears to be standing down, which is a good thing for all parties concerned and a very good thing for the world."
- Donald Trump
Tension between the US and Iran has eased, for the time being, after Donald Trump gave a speech saying Tehran appeared to be standing down, following missile strikes on two air bases in Iraq housing American and coalition troops.
The president said the attacks on the Irbil and Al Asad bases caused no casualties.
Iran confirmed it was acting in retaliation for the assassination of Qasem Soleimani, a high-ranking general who was killed in a US drone strike in Baghdad last week.
America's decision to target Soleimani and other militia figures backed by Iran added further friction to already deteriorating relations between the two countries.
Trump has described the general as "the world's top terrorist" and UK prime minister Boris Johnson, while calling for restraint on all sides, admitted: We will not lament [Soleimani's] death".
Iran responded by saying there would be reprisals, with the country's supreme leader, Ayatollah Ali Khamenei, telling the "criminals" behind the attack to expect "severe revenge".
Tehran took action in the early hours of Wednesday morning (January 8), local time, launching a total of 16 missiles from at least three sites in Iran, US defence secretary Mark Esper said. At least 11 missiles hit the air base in Al Asad, west of Baghdad, and at least one more struck the Irbil base.
While there were no casualties and only minimal damage to the bases, the strike was the most direct Iranian assault on the US since the seizing of the American embassy in Tehran in 1979.
Khamenei said the missile attacks were a "slap in the face" for the US and once again called for the removal of American forces from the Middle East.
Trump had previously taken a tough stance towards Iran, tweeting that if the country targeted American people or assets, Washington's response would be to "hit them harder than they have ever been hit before".
In a televised address from the White House, however, the president adopted a much more sober tone and appeared to step back from any further military action.
What did Trump say?
Speaking in the Grand Foyer of the White House, and flanked by Esper, vice-president Mike Pence and high-ranking military officials, Trump confirmed that no American or Iraqi lives had been lost in Wednesday's missile strikes.
He said this was thanks to "the precautions taken, the dispersal of forces and an early warning system that worked very well".
"Iran appears to be standing down, which is a good thing for all parties concerned and a very good thing for the world," the president added.
Trump also noted that "American strength, both military and economic, is the best deterrent", adding: "The fact that we have this great military and equipment, however, does not mean we have to use it."
While the threat of a full-scale military confrontation has receded for now, the US is set to impose additional financial and economic sanctions on Iran.
Trump said this would continue until the country "changed its behaviour", specifically in terms of abandoning its nuclear ambitions and ending its "support for terrorism".
The Republican leader said the "civilised world" had a responsibility to send a clear message to Tehran that its "campaign of terror, murder and mayhem" would no longer be tolerated.
Easing tension boosts stock markets
Indications that both sides are backing down from further military action have buoyed stock markets around the world.
Wall Street shrugged off the Iranian missile strikes that occurred a matter of hours earlier to show strong performance on Wednesday, with all three of the major US indexes gaining value on the day.
The Nasdaq Composite was trading 0.67% higher at the end of the day, while the Dow Jones Industrial Average was up by 0.56% and the S&P 500 by 0.49%.
It was a similar story in Asia on Thursday. In Hong Kong, the Hang Seng Index rose by 1.68% over the course of the day, while the Shanghai Composite Index closed 0.91% higher.
Japan's Nikkei 225 index experienced an even bigger jump of 2.31%, while London's FTSE 100 gained 0.5% during morning trading on Thursday.
What is Tradefair?
Tradefair is Betfair's new spread betting service, offering trading on thousands of financial markets such as Gold, EUR/USD, FTSE 100 and Twitter. Whether you think prices are going up or down, Tradefair lets you take a view.
Check out our latest Special Offers
Please note: Our services include products that are traded on margin and carry a risk that you can lose more than your initial deposit. The products may not be suitable for everyone - ensure you fully understand the risks involved.