The euro slipped further against the yen on Wednesday as investors get cold feet about carry trading.

In carry trading, investors borrow low-interest currencies and use it to invest in higher-yielding - and usually higher-risk - assets.

However, recent data from the US has sparked concerns about the state of the subprime mortgages market and this has had repercussions around the world.

The euro fell to 161.91 from 162.30 in New York trading, hovering near a multi-month low of 160.47, which it reached earlier in the week.

"The market is concerned that there may be more companies with subprime issues coming out of the closet," Kathy Lien, chief currency strategist at told the International Herald Tribune.

"The carry trade isn't a one-way trade to the upside any more. The yen stands to benefit as investors get back to risk-aversion mode," she added.