South Korea's Kospi sank 1.7 percent to 2,319.83 and Hong Kong's Hang Seng shed 1.8 percent to 26,946.81.
The Korean won KRW=KFTC also continued to skid, sliding 0.3 percent to 1,145 won to the dollar, after earlier sinking to its lowest level in a month. This morning gold had reached $1,286.33 while gold for delivery in December rose 0.8% to $1,290.10. Trading was thinner than usual, with Japanese markets closed for a public holiday.
Investors are paring positions on speculation that equities, recently at multi-year highs amid record-low volatility, may tumble further as tensions escalate.
"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.
Singapore's DBS bank added in a statement that the yen "remains the safe haven currency from the sabre-rattling between US President Donald Trump and North Korea".
"We're still close to the all-time high so that makes people a little nervous too, so they might say now might be the time to take a little bit of money off the table".
The Korean won weakened significantly again and almost all emerging Asian currencies were soft on Thursday amid simmering tensions between North Korea and the United States.
Trump's words were in response to North Korea threatening to attack US territory Guam. "Hard to assess political risk is now intruding on this scenario".
Possibly due to the lack of appetite for risk in the market, the euro suffered on Thursday, down slightly against the dollar by 0.09% at 1.1749, slipping towards a two week low.More news: Federer downs Haase to reach Rogers Cup final
Global benchmark Brent also fell 0.9 percent to $51.44, after Thursday's 1.5 percent drop.
The yen tends to benefit during times of geopolitical or financial stress as Japan is the world's biggest creditor nation and there is an assumption that Japanese investors there will repatriate funds should a crisis materialize. She says Germany would work to find diplomatic solutions with the countries involved, the US and China in particular, but also South Korea.
U.S. Treasury yields US10YT=RR fell to as low as 2.197 percent, their lowest level since June 28, overnight.
Against the dollar, the franc surged 0.6 percent to 0.9688 francs, reversing a two-week losing streak.
The dollar remained steady against a basket of six currencies.
The commodity touched over $1,284.40 an ounce on Wednesday, which marked the highest intraday price in nearly two months.
The Indonesian rupiah slipped by about 0.1 percent to its lowest in over 4 weeks.
USA crude shed 20 cents to $48.97 a barrel, while Brent crude fell 26 cents to $51.88 a barrel.
Ongoing global glut concerns lingered in oil markets despite a bigger-than-expected draw in USA crude inventories. The contract fell 97 cents, or 2 percent, to close at $48.59 a barrel on Thursday.