The euro has sunk close to another one per cent against the US dollar amid more eurozone turmoil, while the Japanese yen has made broad gains feeding on traders' jitters.

With worries mounting that heavy losses in Spain's banks could overwhelm the government and force it to seek a bailout, the euro dropped to its lowest US dollar level in 23 months.

At around 5.00am today, it was trading at $US1.2366, compared to $US1.2503 late Tuesday.

The euro fell to 97.76 yen, compared to 99.39 Tuesday, and the US dollar slipped to 79.06 yen from 79.49.

Both German and US 10-year borrowing rates fell to a record lows as investors fled the rest of the eurozone and Spanish 10-year debt yields hit an unsustainable 6.703 per cent.

"It is now apparent that Spain has left it too late to successfully recapitalise its banking sector," David Morrison of FX360 said of the market's move away from the euro.

The British pound fell as well under the spectre of more severe eurozone turmoil, sinking to $US1.5481 from $US1.5639.