In morning trade on Thursday, Asia markets followed S&P 500 futures lower as speculation of faster hikes in U.S interest rates soured risk appetite globally.
Analysts described the release of the latest Federal Reserve minutes as hawkish which in turn lifted the greenback further away from the 3-year lows experienced last week.
The minutes of the Federal Reserve’s last policy meeting showed the usual concerns that inflation might disappoint, but also an expectation of faster economic growth due to fiscal stimulus. Officials also noted increased economic growth and an uptick in inflation as justification to continue a gradual raise of the interest rates.
The first interest rate hike for the year 2018 in the US is expected in the March FOMC meeting.
The meeting was also the final one for Chair Janet Yellen, who led the Fed as it took the first steps to normalization following years of historic low interest rates. She was succeeded by Jerome Powell, who is largely expected to continue Yellen's strategy of gradual rate hikes.
Meanwhile, U.S. Treasury yields whipsawed following the news. Yield on the 10-year note initially fell from session highs after the release, but recovered to reach a fresh four-year high.
In the currency market, the dollar index, which measures the greenback against a basket of currencies, traded at 90.058, recovering from a previous low of 89.588, though the sudden shift to safety also spurred demand for the Japanese yen.