The dollar stayed on the back foot on Thursday as renewed concerns over the U.S. economy's growth outlook bolstered expectations of a supersized rate cut from the Federal Reserve this month.

The yen was a notable outperformer, in part due to safe-haven demand, but also on the view that imminent rate hikes from the Bank of Japan against the tide of a global easing cycle would lift the Japanese currency due to narrowing interest rate differentials.

The yen was last 0.26% higher at 143.36 per dollar, having risen to a one-month high of 143.20 earlier in the session. For the week thus far, it is up 1.8%.

Global markets have been on edge and stocks, in particular, have been badly bruised after softer-than-expected U.S. data this week reignited concerns that the growth outlook of the world's largest economy was less rosy than earlier thought and the labour market could be slowing more sharply than expected.

"The markets are getting anxious," said Hemant Mishr, chief investment officer at S CUBE Capital in Singapore.

"There was a time when the markets were just focusing on positive news. There's a perceptible change, the market is now focusing on negative news and rationalising a sell-off."

Data released on Wednesday showed U.S. job openings dropped to a 3-1/2-year low in July, suggesting the labor market was losing steam, with the figures coming after Tuesday's ISM manufacturing survey which remained in contraction territory.

"Job openings data for July showed few signs of the ongoing cooling in the labor market coming to an end," said economists at Wells Fargo in a note. "For the Fed, (the) data reaffirm that the labor market is no longer a source of inflationary pressure to the U.S. economy."

Investors have in recent times placed heightened importance on any data relating to the health of the U.S. labour market, given the Fed's focus on protecting it.

The U.S. dollar was nursing some of its losses from the previous session on Thursday as traders ramped up bets of an aggressive Fed easing cycle expected to commence this month.

Against a basket of currencies, the greenback ticked up 0.02% to 101.28.

The euro dipped 0.05% to $1.1077, while sterling was steady at $1.3146.

The Australian dollar fell 0.02% to $0.6724, but was some distance away from an over two-week low hit in the previous session as it drew support from a still-hawkish Reserve Bank of Australia.

Traders now see a 45% chance of the Fed lowering rates by an outsized 50 basis points when it meets later this month, and have priced in more than 100 bps worth of cuts by the end of the year.

Still, the focus this week remains on Friday's nonfarm payrolls report, where expectations are for the U.S. economy to have added 160,000 jobs in August, compared with July's 114,000 increase. The unemployment rate is forecast to ease slightly to 4.2%.

"Our estimate for Friday is it'll be at a 4.2 to 4.3% number. If it's more than 4.5%, I think people will start expecting a 50bp cut," said S CUBE Capital's Mishr, referring to the unemployment rate.

In other currencies, the New Zealand dollar rose 0.05% to $0.6202. The onshore yuan gained roughly 0.2% to 7.1003 per dollar, hovering near its strongest level in over a year.