Finance Minister Yoshihiko Noda said Thursday the yen's advance could become "problematic" as the currency extended its gains against the dollar.
"Movements have strayed from fundamentals and are one-sided," Noda told reporters. "That will be problematic if it becomes a trend, so I will continue to watch markets closely."
The remarks were stronger than his comments Wednesday that he was closely monitoring "one-sided" gains.
"Recent yen movements probably won't prompt intervention immediately, but it's enough to annoy Noda," said Osamu Takashima, a chief currency strategist at Citigroup Inc. "The Finance Ministry must be mindful of the risk of the yen rising further in the short term, considering the current global situation."
The yen rose more than 3 percent in the five days leading to Thursday.
A stronger yen risks hurting exports when the economy is showing signs of recovering from the damage caused by the March quake and tsunami. Japan last sold yen on March 18 together with its Group of Seven counterparts, as expectations of Japanese investors selling overseas assets after the quake caused the yen to rise to a postwar high of 76.25 to the dollar.