The Japanese yen hit a 32-year low against the US dollar after official data showed prices rose faster than expected in the US.
The yen fell to 147.66 against the US dollar before gaining some ground.
Japanese Finance Minister Shunichi Suzuki said the government would take “appropriate action” against currency fluctuations.
In a rare move last month, Japan spent almost $20bn (£17.6bn) to shore up the country’s struggling currency.
“We cannot afford excessive volatility in a speculative currency market,” Mr. Suzuki told reporters after attending the G7 finance meeting in Washington, DC. Looking with strong feeling.”
Last month, Japan intervened in the global currency market to help support the weakening yen.
The move came after the yen hit a fresh 24-year low against the dollar, the first time Japanese authorities have intervened in the currency market since 1998.
However, analysts caution that such an intervention will have little effect as long as Japan’s interest rates remain much lower than those in the United States.
The Japanese currency has come under increasing pressure in recent months, largely due to a very different approach by the Bank of Japan (BOJ) compared to the US Federal Reserve.
On Thursday, official data showed U.S. consumer prices rose more than expected last month, a sign that the fight against inflation in the world’s largest economy is far from over.
Inflation, the rate at which prices rise, was 8.2 percent in the 12 months to September, down from 8.3 percent in August.
Rising consumer prices in the US are being closely watched as the Federal Reserve’s efforts to cool inflation push up the value of the dollar as well as the cost of global borrowing.
The U.S. central bank has been raising interest rates aggressively to combat rising prices, making the dollar more attractive to investors. In contrast, the BOJ has kept rates very low.
The strengthening of the dollar on global financial markets is also having an impact on other major currencies around the world, including the pound and the euro.
