The dollar hit a new high six-year high against the yen on Wednesday, breaching 110 for the first time since August 2008.
The currency pair reached 110.08 in early Asian trading, prompting a Japanese government spokesperson to say that authorities will monitor the yen's movement carefully.
The greenback has strengthened more than 8 percent against the yen since early August, driven by the Federal Reserve's tightening monetary policy and recent weakness in the Japanese economy.
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Japanese policymakers welcome a weaker yen, which boosts exports, but the rapid move is worrying. Japan is stuck with a chronic trade deficit; a major yen depreciation raises the cost of buying materials abroad, squeezing corporate earnings.
The dollar-yen could rise slightly further, but will stabilize soon, according to Eisuke Sakakibara, former vice finance minister of Japan.
"Although Japanese economy is currently somewhat weaker than anticipated, it's still doing fairly well," said Sakakibara, also known as Mr Yen for the influence of his pronouncements on Japan's currency when he was in office from 1997 to 1999.