The British pound fell further on Monday, reflecting pessimism over efforts by central banks to control inflation.
The benchmark index of the Japanese stock market fell 2.5% to 26,460.08. The S&P/ASX 200 fell to 6,479.30 The Kospi dropped in South Korea. The Hang Seng in Hong Kong lost 0.5% to 17,851.36.
The British pound fell against the U.S. dollar last week after the U.K. government said it would cut taxes. Concerns have been raised that increased public borrowing will make the cost of living worse.
The pound fell to a low of $1.0349 per U.S. dollar early Monday, but recovered to a low of $1.0671. On Friday it fell.
The recent moves by the U.S. Federal Reserve and other central banks around the world to raise interest rates are intended to curb decades high inflation but they also threaten a recession if the rates rise too much or too quickly.
Major indexes lost ground for the fifth week in a row last week. There was discouraging data on European business activity, and a report suggested that the U.S. is still contracting.
The S&P 500 has dropped for four straight days. At one point, the index was down more than 800 points, but ended the day with a loss of 4.6%. The index fell to 10,887.93.
Smaller company stocks did not fare well. The Russell 2000 lost 2.5% of it's value.
Technology companies, retailers and banks are among the biggest weights on the S&P 500.
The Fed raised its benchmark rate last week to a range of 3% to 3%. At the beginning of the year, it was very cold. The Fed expects its benchmark rate to be 4.4% by the end of the year, a full point higher than in June.
Benchmark U.S. crude was down 84 cents to $77.90 a barrel in electronic trading. The price of crude oil fell to their lowest level since early this year on fears that a weaker global economy will reduce demand.
It was down 87 cents to $85.28 a barrel.
Many countries are concerned about the recent rise in the US dollar. It hurts profits for U.S. companies and puts a squeeze on the developing world.
The Japanese government and the Bank of Japan have been intervening in the currency market.
On Monday, it was 141.90 Japanese yen, up from the previous day's 141.32 yen. The euro fell to 96.32 cents.
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