The dollar surpassed the Y84 mark Friday for the first time since Sept. 29 as Korean peninsula tensions caused investors to bolt from the yen, and gained against the euro as investors reacted to fresh signs of strain in the euro zone.

Fear of an escalation of Korean tensions has fed a recent push into the dollar from the yen, because of the proximity of Japan to the conflict and the dollar being still considered a safe harbor in times of stress, analysts said.

Explosions were heard in Yeonpyeong Island Friday afternoon, and smoke was visible on the coast of North Korea, three days after a North Korean artillery barrage killed four people on the remote South Korean island. North Korea has warned the U.S. its plans for naval exercises with the South will drive the peninsula "closer to the brink of war," according to Sky News.

The dollar had been under pressure against the yen for most of the year, so this new trend marks a significant reversal, said Steven Englander, head of G10 strategy at Citigroup in New York.

Earlier this year, the yen had gained from worldwide risk aversion, in its traditional role as the ultimate safe-haven currency, while concerns over dollar-diluting Federal Reserve stimulus measures in early fall had also pushed the dollar sharply lower against the yen, said Englander.

"But the arguments they had [for that trade] are now very stale, and now they have a reason to move away from it," with concerns over Korea, he said.