Equity markets across The US, Europe and Asia sold off sharply on Monday as growing concerns over the unwinding of the yen carry trade drove Tokyo’s benchmark Nikkei 225 Average more than 3 per cent lower.

The US dollar slumped 1.2 per cent to Y115.43 against the Japanese currency as yen carry trades – where low-yielding yen are borrowed to fund higher-yielding investments – unwound sharply. The euro fell 1.7 per cent to Y151.57.