All eyes in financial markets were on an appearance by Janet Yellen on Thursday after meeting minutes showed the U.S. Federal Reserve is still far from another rise in interest rates, driving the dollar to its weakest against the yen in 17 months.
A more than one percent drop took the U.S. currency's losses to almost 10% so far this year, and the absence of intervention by Japan in response has spurred talk that a global deal may have been done to weaken the dollar.
That remains unsubstantiated but the surge of money into the perceived safety of the Japanese currency reflects the scale of concern over global growth that has again stayed the Fed's hand.
European stock markets were back on the retreat on Thursday after a cautiously optimistic start and Wall Street also looked set to open lower.
"What markets really need are more positive global economic data similar to the ones seen out of China of late, indicating a pick-up in economic activity especially in the euro zone and the U.S.," said City of London Markets trader Markus Huber.
Banking shares again led the slide amid talk of further layoffs and cutbacks planned by Europe's major lenders as they struggle with zero interest rates and a shortage of growth and borrowing across the globe.
The concerns over debt and growth-related risks to companies worldwide, particularly in developing economies, were also visible in minutes of the European Central Bank's March policy meeting.
Yellen was due to speak in a panel discussion later in the U.S. session. Her caution over further rises in rates was the trigger for another sharp sell-off in the dollar last week.
After strong gains overnight, oil was also down around half a percent. Chinese shares fell 1% and the broad Eurofirst index of Europe's leading companies was down 0.5% on the day, putting it on track for its fourth consecutive weekly loss.
The yen has gained 9.5% in the same period.
"We are in a broad-based soft dollar environment, and given the yen is cheap in relation to its long-term fundamentals, it is not surprising it is outperforming," said Petr Krpata, FX strategist at ING.
"The rise is leading to speculation of intervention by the Japanese. But we think the bar for that is pretty high."