The dollar dropped to a record low against a basket of currencies and the euro Thursday, after Bank of America's third-quarter earnings results missed estimates, renewing concerns of a U.S. economic slowdown.
Weak earnings from the second-largest U.S. bank on the back of mounting credit losses sent U.S. stock indexes lower and U.S. Treasury prices higher on expectations slowing activity might prompt the U.S. Federal Reserve to cut interest rates.
The yen gained against the dollar as investors became more risk-averse and unwound carry trades in which they buy high-yielding currencies funded by borrowing low-yielders such as the yen.
It was the yen's fourth straight day of gains against the dollar, the longest streak of gains since the four days leading up to the Fed's surprise 50 basis point cut of the discount rate, at which it lends to banks, on Aug. 17.
"Bank of America earnings play up concerns about the health of the financial sector and suggest we are likely to see fall out from market volatility, with the yen being the main beneficiary," said Omer Esiner, foreign exchange analyst at Ruesch International in Washington.
Late morning in New York, the euro was up around 0.6 percent on the day at $1.4287, after climbing to a lifetime peak at $1.4310 in the opening hours of the New York session, according to Reuters data.
The euro fell 0.3 percent against the yen to 165.20 yen.
The dollar was 0.8 percent weaker at 115.65 yen, near an earlier two-week low.
The dollar index, a measure of the dollar's value against six major currencies, was down 0.6 percent at 77.620.
Earlier in the session it fell to 77.478, the lowest since its post-Bretton Woods inception more than 30 years ago. It was the largest one-day percentage drop on the index since Sept 28.