The Japanese currency, the yen, is falling against the dollar in the wake of action by the authorities to arrest its recent gains.
The yen's rise is worrying the authorities
Japan is keen to cap the yen's appreciation, which could damage prospects for the exporters on which the country's fragile recovery depends.
Newspaper reports suggest that the Bank of Japan is preparing to raise the legal limit on its borrowing so it can keep buying dollars.
But the yen's decline is proving hard to sustain, as investors continue to bet on US determination to keep the dollar weak.
Early trading in Tokyo saw the yen fall half a percentage point to 111.30 to the dollar, but by lunchtime the currency was back up to 110.90, not far off a three-year high of 110.10.
The US has long insisted on a strong dollar, but the Bush administration now wants the greenback to slip so as to bolster the economy at home.
Widespread US job losses are being blamed by politicians on foreign competition, particularly from Asia, and the White House is keen to appear to be doing something about it.
The most recent meeting of the G-7 industrialised nations - including Japan and the US - backed a "more flexible" exchange rate situation, implying backing for a slide in the dollar.
Aside from Japan, China remains the main focus of US attention on currencies.
The Chinese yuan is kept locked at a value of around 8.30 to the dollar.
But US authorities are now repeatedly saying the exchange rate, set some years ago, is now out of step with the booming Chinese economy.
The US wants China to move to a floating currency, but Beijing fears that such a move would spell disaster for China's already pressured job market.