A drop in the value of the dollar caused stock markets to plunge around the world on Monday.
Leading stock market indexes in the US, Japan, France and Germany all fell heavily during the day's trading.
The falls were triggered by a statement from the G7 group of rich nations, meeting in Dubai at the weekend, who called for market forces to set exchange rates.
The statement hit US stock markets, as investors feared that a laissez-faire attitude towards the weak dollar would deter foreign investment.
"If the dollar continues to fall, there is increasing risk that foreign investors will pull money out of US stocks and bonds," said Mike Kayes, chief investment officer at Eastover Capital.
In New York, the Dow Jones closed 109 points lower at 9,535, while the Nasdaq technology index lost 1.6% of its value.
The statement also hit countries which export to the US, who fear that the weak dollar will make their products less competitive in the key US market.
Signs of a US economic recovery have boosted the share price of many of these exporting firms recently.
But the weak dollar will undermine the hopes of a recovery.
Japan's stock market plunged by more than 4%, after a strong jump in the yen sparked fears that crucial exporters such as Sony and other technology firms might start to suffer.
The yen, which has been steadily gaining over the past two years, rose by 2% to almost 111 yen in the dollar, after reports at the weekend indicated that the central bank could do nothing to stem further gains.
In Europe, carmakers such as Porshce, Renault and BMW - all of whom have active export markets to the US - led the way down.
France's Cac index fell 2.7% while Germany's Dax plummeted 3.4%.
"Currency wobblies have hit global markets hard, as a falling
dollar and a rising yen and euro tend to impact crucial export
activity," said Larry Wachtel at Prudential Securities.