Weakness in the yen is increasing with a trade-weighted gauge of the currency falling to the lowest in more than two decades.
Deutsche Bank AG's measure of the yen's strength compared to its global trading peers closed at a record low Monday, according to data going back to 2000. The value of the currency has once again become stranded in the widening gap between the Bank of Japan's super-easy monetary policy and the hawkish shift seen in counterparts in Europe and the US.
The move adds to expectations of at least more verbal intervention to stabilize the currency. Japan's finance minister, Shunichi Suzuki, said on Tuesday that he remains closely watched market moves and will take appropriate action on FX policy as necessary.
The yen fell 0.1% to around 142.10 percent, a seven-month low against the greenback.
Actual intervention is unlikely now, but risks may become more real when it drops below 145 and 150 at a fast pace, said Tsutomu Soma, a bond and currency trader at Monex Inc. in Tokyo. The European currency crosses look most bullish compared to the yen. The Federal Reserve said it may resume tightening after a June pause, the European Central Bank hiked, and traders expect the Bank of England to lift rates on Thursday. The government kept its tone dovish at its latest meeting.