HONG KONG (AFP) - Asian shares and the dollar sank Friday on growing concerns about the global economy while the head of the IMF warned the eurozone could slip into recession if governments do not act.
Investors took their lead from a heavy sell-off on Wall Street, which wiped out the previous day's Federal Reserve-fuelled gains. Fears of a fall-off in demand also sent oil traders fleeing, pushing crude prices to loses not seen since 2012.
Tokyo tumbled 0.90 per cent owing to a stronger yen, which is considered a safe bet in times of turmoil. Singapore was down 0.97 per cent, Hong Kong lost 1.42 per cent, Sydney shed 1.60 per cent and Shanghai was 0.40 per cent lower while Seoul sank 1.10 per cent.
Markets surged after minutes released Wednesday from the Fed's most recent meeting indicated policymakers could refrain from hiking US interest rates any time soon as global economic and geopolitical woes were offsetting a domestic recovery.
But that elation was erased late Thursday after another round of negative eurozone data, including a 5.8 percent slump in German exports in August. Leading German think tanks also slashed their growth forecasts for the eurozone's largest economy.
On Wall Street overnight the Dow tumbled 1.97 per cent, the S&P 500 shed 2.07 per cent and the Nasdaq sank 2.02 per cent.
The US dollar, which touched a six-year high above 110 yen last week, was struggling at 107.70 yen in Asia Friday, compared with 107.84 yen late in New York. The Japanese currency, a safe haven investment, has spiked as traders look to protect their cash.
Oil prices fell to two-year troughs on demand worries.
US benchmark West Texas Intermediate for November delivery tumbled 90 cents to US$84.87 in mid-morning trade, its lowest level since mid-December 2012.
Brent crude for delivery in November declined 85 cents to US$89.20 its lowest since June 2012.