The Korean won continued to fall versus the dollar, down 0.13 per cent to 1,143.5 on Friday for a 1.6 per cent decline on the week.
US Secretary of Defense James Mattis issued a stark warning to North Korea to "cease any consideration of actions that would lead to the end of its regime and the destruction of its people".
Global stock markets ended their worst week in months amid rising tensions between the USA and North Korea, though US stock indexes steadied on Friday to close up slightly.
Investor focus now turns to Friday's USA consumer price index data.
Emerging market stocks lost 1.27 per cent. MSCI's broadest index of Asia-Pacific shares outside Japan closed 1.47 per cent lower.
The U.S. -North Korea tensions add to investor angst that has helped push up gold more than 11 per cent this year, even with equities hitting records and the U.S. Federal Reserve keen to shrink its balance sheet.
Japan's Nikkei 225 Index edged down by 0.1%, while Hong Kong's Hang Seng Index tumbled by 1.1%.
United States markets fell on Wednesday morning, spooked by rising tension between the USA and North Korea. Gold, meanwhile, a traditional safe haven for investors, gained $26.50 since Monday, closing Thursday at $1291.20 per ounce.
The North Korea situation isn't the only thing weighing on stocks.
"North Korea is being used as a reason to sell Japanese stocks, just as it was used yesterday in the U.S.", said Soichiro Monji from Daiwa SB Investments in Tokyo.
Banks also fell 2 percent, putting the index on track for its worst week in nine months.
CURRENCY: The dollar declined to 109.79 yen from Tuesday's 110.34 yen.
Overall, earnings growth for MSCI Europe companies was tracking 24 percent, Thomson Reuters data showed, while MSCI Euro zone companies were seeing 16 percent earnings growth for the second quarter.
"Both (PPI measures) were well below consensus and give us no hope that consumer price inflation is going to materially beat expectations", said Chris Weston, chief market strategist at IG Markets. In bond markets, 10-year US Treasuries and Germany's ultra-safe government bonds were trading at their highest prices since June.
In commodities, US crude fell 0.67 percent to $49.23 per barrel and Brent was last at $52.58, down 0.23 percent on the day.