Dudley also cautioned that "it's going to take some time" for inflation to rise to the central bank's 2 percent target even as he offered a generally positive outlook for the US economy, job market and price pressures. It was down 0.1 percent at 109.07 yen JPY= , after retreating 0.8 percent on Thursday.
South Korea's KOSPI fell 1.4 percent, taking its losses this week to almost 3 percent.
Overnight, Wall Street closed sharply lower after Trump, with fiery rhetoric, warned Pyongyang against attacking Guam or U.S. allies after it disclosed plans to fire missiles over Japan to land near the U.S. Pacific territory.
Possibly due to the lack of appetite for risk in the market, the euro suffered on Thursday, down slightly against the dollar by 0.09% at 1.1749, slipping towards a two week low.
The Federal Reserve has a 2 percent inflation target and tracks a measure that has been stuck at 1.5 percent since May despite the labor market being near full employment.
U.S. Treasury benchmark yields rebounded from six-week lows as the easing of tensions with North Korea led investors to pare back their holdings of low-risk government debt.
"Traders should closely watch global equities today, with further falls and risk aversion likely pumping more safe-haven flows into precious metals", said Jeffrey Halley, a senior market analyst at OANDA.
Wall Street opened higher on Monday, with broad gains across sectors, as investor sentiment was lifted by easing tensions in the Korean peninsula after key US officials played down the risk of an imminent war with North Korea.
U.S. Treasury yields US10YT=RR fell to as low as 2.197 percent, their lowest level since June 28, overnight.
That prompted North Korea to say it was considering plans to fire missiles at the USA island territory of Guam.
Australia's S&P/ASX 200 dropped 1.2 percent, while Japan was closed on a public holiday.
Gold was out of favor on Monday after clocking a 2.46 percent jump last week. The Japanese currency, which firmed around 1.4 percent last week, tends to benefit during times of geopolitical or financial stress as Japan is the world's biggest creditor nation.
"After the one and a half percent self-off last week, we got a bit of a investor attitude to buy the dip", Hogan said. Against a basket of major currencies, the US dollar rose 0.3 percent.
US producer prices unexpectedly recorded their biggest drop in almost a year, and the number of Americans filing for unemployment benefits unexpectedly rose last week.
Europe's main London, Frankfurt and Paris markets started between 0,5 percent and 1,1 percent lower, and Germany's ultra-safe 10-year government bonds were trading at their highest prices since June. They plunged 2 percent on Thursday on fears of slowing demand and lingering concerns over a global oversupply. It is poised to end the week down 1.9 percent.
US crude rose 0.49 percent to $49.06 per barrel after falling as low as $48.37 and Brent was last at $52.27, up 0.33 percent after hitting a low of $51.60.
Brooks is running against odd in the Alabama election to decide who will gain Attorney General Jeff Sessions's Republican seat. The message followed a tweeted endorsement by Trump last week in an attempt to boost unusual in what could be a close race.
Kenya's election commission said its process was fair and worldwide observers praised its handling of the election. The opposition called the vote a "charade" and said that going to court to challenge it was not an option.
The German government, like Italy's before it with Alitalia, is now helping to find a solution to protect jobs. German carrier Air Berlin's aircrafts at Tegel airport in Berlin, Germany , September 29, 2016.
Bolt took the unusual step of racing the relay heats, something usually reserved for the more unheralded members of the squad. Sir Mo Farah admitted his quest for double World Championship gold will be tough as he looks for the fairytale farewell.
US officials have estimated that the United States suffered $260 billion in flood related damages between 1980 and 2013. The order calls for a $1 trillion revitalization package, though no legislation now exists for this upgrade.
Minutes earlier, CSKA goalkeeper Igor Akinfeev made a superb reflex effort to tip Guillaume Horau's shot over the bar. Nathaniel Clyne remains out with a hamstring injury so Trent Alexander-Arnold should continue at right-back.
German growth slower, but still strong ahead of election
The German economy, Europe's traditional growth engine, grew in line with the eurozone's 0.6 per cent average in the quarter. The preliminary estimate showed GDP growth rose by 0.6% between April-June compared with the same period a year ago .
Trump reassures governor of Guam in phone call
North Korea's state news agency KCNA reported earlier in the day that leader Kim Jong Un had examined plans for a launch. Tillerson says: "We continue to be interested in trying to find a way to get to dialogue but that's up to him".
Lincoln Memorial vandalized with explicit graffiti
It took nearly one month to remove the damage but the woman was later found incompetent and didn't stand trial. Park Police is now investigating the incident-anyone with information can call them at 202-610-7515.
Trump just retweeted someone appearing to call him a 'fascist'
Arpaio continued to carry out the operations for another 18 months but claimed that he didn't violate the order intentionally. Trump then deleted another retweet which showed a person with the CNN logo superimposed over them being hit by a Trump train.
Woman says she found rodent in Chick-fil-A sandwich
The lawsuit stated that Kwon previously worked within restaurant businesses and was an asset to the companies. In published reports , the franchisee says they will not comment on an ongoing allegation and investigation.
PM Modi concerned about Gorakhpur deaths, says CM Adityanath
Patel said that Prime Minister Narendra Modi was concerned about the incident and assured all cooperation to UP in health sector. The hospital has reported that most of the deaths from a lack of oxygen occurred in its neonatal and encephalitis wards.
Death toll from flood, landslide climbs to 49
The road blockage and bad weather have hampered the rescue and relief operations in the areas affected by the floods. A Kathmandu Post report said that public health experts have warned of water-borne epidemic in the flood-hit areas.