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Asian shares extended losses on Friday from the 2021 low set a day earlier, while the dollar held onto its recent gains sitting at a nine-month high.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.75 per cent, with Chinese blue chips down 1.22 per cent and Hong Kong down 0.53 per cent.
Japan's Nikkei fell 0.53 per cent, and US stock futures,the S&P 500 e-minis, were down 0.26 per cent.
A day earlier Asian and European stock markets and oil fell sharply and the dollar rose to a nine month high, after the prospect of the Federal Reserve cutting back bond purchases spooked investors.
This also sent the dollar to its highest level since early November, gains which it held onto on Friday.
The dollar indexwas little changed from the previous day at 93.517on Friday.
"The recent weakness in Asian equity markets is partly driven by the strengthening of the US dollar as the marketprepares for the gradual reduction of monetary stimulus," said Fan Cheuk Wan, HSBC's Asia chief investment officer for private banking.
The strong dollar will keep Asian equity markets volatile so we need to wait for clarity from Jackson Hole," she added.
The US Federal Reserve will hold its annual research conference in Jackson Hole, Wyoming, next week. Fed Chair Jerome Powell is due to give a speech that will be scoured for clues onthe central bank's next steps.
On Friday, traders are also waiting to assess Chinese policymakers' thinking, as the country will set its benchmark lendingrate.
.On Wall Street, stocks ended the day mixed, with defensive and tech-heavy stocks regaining ground after two days of losses. The Dow Jones Industrial Average fell 0.19%, while the S&P 500 climbed 0.13% and the Nasdaq Composite added 0.11%.
Oil prices continued to fall. US crude dipped 2.57%to $63.78 a barrel. Brent crude was flat at $66.42.
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