The Japanese currency plunged to as low as 153.24 yen per US dollar to hit a 34-year low yesterday amid Japanese authorities pledges to consider all available options for the market.
"Whether this involves currency intervention or not, we authorities are prepared for all situations all the time," Masato Kanda, Japan's top currency official, told reporters.
Finance Minister Shunichi Suzuki later echoed the warning, saying officials are monitoring the currencies "with a high sense of urgency."
The weakening of yen followed reports that US consumer prices rose more than estimated in March which led to a surge in US Treasury yields and the US dollar as investors scaled back bets on US interest-rate cuts this year.
Kanda stopped short of warning that authorities were ready to take "bold" measures which would be the most direct reference to action in the ministry's playbook.
China's yuan also fell to a five-month low against the greenback on hotter-than-expected US inflation data despite the central bank's efforts to guide it higher. The onshore yuan closed at 7.2369 per US dollar yesterday.
Meanwhile, Standard Chartered Hong Kong believes the development could mean short-term opportunities for the local stock market although caution remains for the long-term outlook.
Analysts at the bank expect the Hang Seng Index to reach 18,100 points within a year. The HSI edged down 0.3 percent to close at 17,095 points yesterday in wake of China's weaker inflation data in March.
Separately, Hang Seng Investment Management announced the launch of an exchange-traded fund that tracks the S&P 500 Index in the US, which will be listed in the city on April 23.
