The Finance Ministry on Monday restated its stand regarding foreign exchange markets.
"As I have said before, rapid movements are not desirable," Vice Finance Minister Toshiro Muto said. "We have to take action if there are such moves."
He also reiterated the exchange rate should reflect economic fundamentals.
The yen has been strengthening even though the Japanese economy is deteriorating. As it strengthens, the country's exports become more expensive.
Muto said the foreign exchange issue will be a topic of discussion at a meeting late this month of the Group of Seven finance ministers and central bank governors in Washington.
Turning to plunging Tokyo stock prices, Muto said prices reflect various factors such as moves in the U.S. stock market, the Japanese economy and foreign exchange rates, but he declined to comment on stock prices.
He simply said he is carefully watching the market.