Investors expect Trump's proposals to deport illegal immigrants, renegotiate free-trade deals and unleash large fiscal stimulus measures will boost U.S. inflation.

The dollar also extended gains against the Chinese yuan and Mexican peso to historic levels on expectations that emerging markets will suffer most if Trump turns his protectionist rhetoric into action.

"Everybody loves U.S. assets, so hence why the emerging markets currencies and equities and obviously their own bonds are all under pressure," said Dean Popplewell, chief currency strategist at Oanda in Toronto.

"We continue to see the squeeze in emerging markets. Certainly people will want to move their capital, stateside at the moment, and with higher rates and reflation and inflation U.S. Treasuries will eventually be coveted," he added.

China fixed the yuan another 0.2 percent lower at 6.8120 per dollar and less tightly controlled offshore rates reached as high as 6.85 yuan , pointing to expectations of more losses. It was the lowest for the yuan against the dollar in six years.

Currencies associated with the Trans Pacific Partnership were lower across the board amid news on Friday that Trump's election had effectively made the trade deal with Asian and Latin American nations a nonstarter for the U.S. Congress.

The Mexican peso sank 3 percent to a record low of 21.395 per dollar and the Canadian dollar fell to its lowest since February.

In South America, Peru's sol fell to its lowest since March against the dollar with the Chilean peso falling more than 1 percent.

The New Zealand and Australian dollars both dipped by around 1 percent against the dollar.

In Asia, the Malaysian ringgit fell to its lowest since January and the Singapore dollar hitting its lowest since February.

The euro fell to its lowest against the dollar since March, touching $1.0836 .

The dollar erased most of its losses on the day against the Japanese yen to trade little changed from late Thursday's levels. It gained 3.5 percent versus the yen for the week.

The dollar index <.DXY>, which tracks the dollar against six rival world currencies, rose more than 2 percent this week, its best one-week gain since November 2015.

(Reporting by Dion Rabouin; Editing by James Dalgleish and Chizu Nomiyama)

By Dion Rabouin