The yen rose across the board on Monday as global stock markets fell on worries of more credit-related troubles at U.S. banks, causing investors to reduce their exposure to risky assets and unwind carry trades.

Citigroup said at the weekend it might take an additional $11 billion write-down for subprime losses, on top of $6.5 billion it wrote off three weeks ago. Its Chief Executive Officer Charles Price has stepped down.

The uncertainty surrounding some of the top banks and forecasts of further write-downs due to the subprime market has been weighing significantly on global stock indices, said Matthew Kassel, director of foreign exchange at ING Capital markets in New York.

That forced the carry unwind, more so than the dollar trade. Yen crosses across the board are down.

Carry trades are strategies in which investors fund purchases of securities in high-yielding currencies by borrowing in a low-yielding currency such as the yen. U.S. stocks futures were pointing to a lower open on Wall Street.

In early New York trade, the dollar was down 0.6 percent at 114.13 yen, not far from a session low of 114.08 struck in overseas trade. Against the yen, the euro fell 0.8 percent to 165.21.

The yen was also boosted by hawkish comments from Bank of Japan Governor Toshihiko Fukui, underlining the need to raise interest rates in a timely manner.

The euro's losses versus the yen helped the dollar to recover from last week's record troughs against the single currency. However, lingering worries over the health of the world's largest economy limited gains, despite unexpectedly strong U.S. jobs data on Friday.

Slowing (U.S.) consumption and a drag from inventories means there is likely to be slower growth in Q4 than Q3 -- enough to make the Fed cut, said Derek Halpenny, senior currency economist at BTM-UFJ.

The euro was down 0.2 percent at $1.4472, still in sight of record highs at $1.4528 set on Friday, according to Reuters data. Traders saw the euro trading in a $1.4395-$1.4510 range during the New York session.

The dollar index, which tracks the greenback's performance against a basket of six major currencies, was 0.1 percent higher at 76.405. The index fell to 76.220 on Friday, the lowest in its more than 30-year history.

The high yielding Australian dollar fell 0.6 percent to $0.9181, while sterling lost ground against both the euro and the dollar after data from Britain's manufacturing and service sectors came in below forecast.

Sterling was last trading down 0.6 percent at $2.0782, retreating from Friday's 26-year highs above $2.09.

Investors will keep an eye on the Institute for Supply Management's non-manufacturing index for October due at 10:00 a.m., as well as a speech by Atlanta Fed governor Randall Kroszner for clues on the short-term interest rate outlook.

Fed Governor Frederic Mishkin said on Monday the Fed acted aggressively with two interest rate cuts to prevent financial market turbulence from damaging the U.S. economy, but will be ready to act just as quickly if it overdid its policy medicine.

The Fed cut its benchmark fed funds target rate by 25 basis points to 4.50 percent last week.

(Additional reporting by Meg Clothier in London)