Asian shares fell on Monday and the dollar languished near a record low against the Swiss franc, as investors took fright at a downgrade of the U.S. credit rating, while gold powered to another record just short of $1,690 an ounce.

The euro jumped on hopes the European Central Bank will start aggressively buying the bonds of Italy and Spain, the latest nations threatened by the euro zone's growing sovereign debt crisis.

Also hoping to soothe market jitters following one of the worst routs since the dark weeks following the collapse of Lehman Brothers in 2008, G7 finance leaders agreed to offer ample liquidity to stabilise markets if needed.

"They are working against a pretty bearish market sentiment generated over the last couple of weeks and culminating in the historic nature of the events over the weekend," said Greg Gibbs, strategist at RBS in Sydney.

Ratings agency Standard & Poor's cut the U.S. long-term rating by one notch from AAA on Friday, capping a week that saw $2.5 trillion wiped off companies' values amid worries the United States is sliding back into recession.

The global rout, exacerbated by Europe's enfolding crisis, represented the biggest weekly price decline for the MSCI All-Country World Index since early October 2008, according to Thomson Reuters Datastream.

Tokyo's Nikkei fell 1.5 percent on Monday and MSCI's broadest index of Asia Pacific shares outside Japan lost 0.6 percent. U.S. S&P 500 futures SPc1 were down 2 percent.

"The downgrade was expected, but the timing is a surprise. We expect trading to be volatile over the next 2-3 days as markets absorb the news, although money should continue to flow into Asia," said Sydney-based Robert da Silva, fund manager with Principal Global Investors, which oversees over $200 billion in assets globally.

"We don't see a huge amount of forced selling of U.S. Treasuries, the downgrade does not tell us anything about the U.S. economy that we did not know."

The euro briefly climbed as high as $1.4432, up more than a cent from late New York levels on Friday and a long way from last week's lows around $1.4055, and was later trading around $1.4315.

Yields on Italian and Spanish debt soared to 14-year highs last week on political wrangling and doubts over the vigour of budget cuts, raising fears that the euro zone's bailout fund for struggling members could be overwhelmed.

Following a rare Sunday conference call held by the ECB, a euro zone monetary source said the central bank would intervene "significantly" to protect Italy and Spain from the debt crisis, indicating it would buy government bonds of the euro zone's third and fourth biggest economies.

A statement from the ECB said it would "actively implement" its bond-buying programmes.

The dollar remained under pressure, touching a record low versus the Swiss franc before pulling back to around 0.7625 . The Swiss currency is viewed by many investors as a safe haven from financial turbulence.

Gold , another safe haven, hit a record high around $1,689 an ounce, but commodities tied to economic growth fell, with U.S. crude oil futures CLc1 down 2.6 percent.

"I think troubles in Europe are also undermining markets. Progress in dealing with Europe sovereign debt issues is painfully slow," said Natalie Robertson, a commodities strategist at ANZ. (Additional reporting by Ian Chua in Sydney, Adrian Bathgate in Wellington, Umesh Desai in Hong Kong, Lewa Pardomuan in Singapore; Editing by Ron Popeski)

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