Asian shares tumbled on Friday while the US dollar and Treasury yields rose in a reversal of a day earlier after investors expressed concerns that rising interest rates could hurt global economic growth.

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The market fears that the US Federal Reserve and some other major central banks will have to raise interest rates even more aggressively than planned to combat red-hot inflation, potentially pushing economies into a recession.

US payroll data due later on Friday will help the market gauge how hot the economy is running.

MSCI's broadest index of Asia-Pacific shares outside Japan shed 2.34 percent on Friday morning and is down 3.5 percent from last Friday's close. Japan's Nikkei was flat on its return from a three-day holiday.

Overnight on Wall Street, the Dow Jones Industrial Average and the S&P 500 both fell more than 3 percent, and the Nasdaq Composite shed 4.99 percent in its biggest single-day plunge since June 2020 to close at its lowest level since November 2020.

This was a reversal of the situation 24 hours earlier when Asian shares opened higher after the S&P 500 had recorded its biggest one-day percentage gain in nearly two years on Wednesday.

"It's been described in one news story I read this morning as the 'Great Puking', which seems appropriate," ING Asia head of research Rob Carnell said of the rapid U-turn in a morning note to clients.

The market is pricing in an 82 percent chance of a monster 75 basis point rate hike from the Fed at its meeting in June, according to the CME's FedWatch tool, even after the Fed raised rates by 50 basis points this week and Powell ruled out a 75 basis point hike.

"Risks remain elevated for a policy mistake -- either by (the Fed) not tightening quickly enough to combat inflation or being overly hawkish, resulting in the end of the current business cycle," said David Chao, global market strategist, APAC ex-Japan, at Invesco.

Chao said US and Asia Pacific equities could continue to experience "a bit of volatility", and US yields might keep rising, but he expected that momentum from the post-Omicron reopening would help support US growth despite Fed policy normalisation.

US yields are rising on expectations of a fast pace of rate hikes. The yield on US 10-year notes was 3.084 percent on Friday morning after crossing 3.1 percent overnight for the first time since November 2018.

A firm commitment by Chinese leaders to maintain a zero-COVID strategy raised fears about the health of the country's economy, while the ongoing war in Ukraine is also hurting sentiment toward risk.

Chinese blue chips fell 2 percent on Friday and the Hong Kong benchmark shed 2.44 percent.

China's yuan traded offshore tumbled to an 18-month low of 6.7338 per dollar.

As investors moved towards less risky assets, the dollar index was at 103.67 on Friday morning, having hit a fresh 20-year peak of 103.94 overnight supported by expectations the US will hike interest rates faster than other central banks.

Sterling for example fell 2.2 percent against the dollar on Thursday. The Bank of England raised rates by 25 basis points as expected but two policymakers expressed caution about rushing into future rate hikes.

Bitcoin one of the risk-friendliest assets tumbled 8 percent overnight and hit a two-and-a-half-month low. It was last trading around $36,300.

Oil prices dipped at the start of Asian trade as worries about an economic downturn outweighed concerns over fresh EU sanctions against Russia, including a crude oil embargo.

Brent futures fell 0.5 percent to $110.3 a barrel. US crude lost 0.56 percent to $107.67 a barrel.

Gold shed 0.3 percent to $1870.7 an ounce.