Concern the US recovery is faltering had driven investors toward the relative safety of the yen and the franc, and is spurring speculation the Federal Reserve will start another stimulus programme.
"Because of what the Swiss National Bank did yesterday, cutting their rate to near zero again, that gave some urgency for Japan to act as well," said Lee Wai Tuck, a currency strategist at Forecast in Singapore. "There may be some temporary effect but as we've seen in the past, the impact of intervention doesn't last that long. There will still be interest to buy the yen at a lower level."
The yen weakened against all 16 of its major counterparts and sank 2.2 per cent to €112.85 against the euro.
The Japanese currency, which this week climbed to near the 76.25 per dollar record reached in March, also weakened on prospects the Bank of Japan will follow its Swiss counterpart in easing monetary policy.
Noda suggested the central bank may follow with monetary stimulus, saying that he hoped the Bank of Japan would take appropriate action.
The European Central Bank and Bank of England are also scheduled to decide today on monetary policy.
Japan's benchmark 10-year yield fell two basis points to 0.995 per cent at Japan Bond Trading, the nation's largest interdealer debt broker.
That is the first time yields have dropped below 1 per cent since November.
Japanese exporters rose, with Nintendo surging 4.4 per cent and Toyota Motor rallying 1.4 per cent.
- Bloomberg
