Japan's exports grow

" We are closely monitoring and watching the market, taking the view that the yen's excessive strength is not good for the economy "
Zembei Mizoguchi, vice finance minister

But there are still worries that exports might be slowing.

The current account surplus, which measures trade in goods, services, tourism and investment, rose to 1.17 trillion yet ($9.9bn; £6.2bn) in November.

It was the second month in a row that the surplus had risen.

Although the figures suggested that Japan's fragile economic recovery was continuing, the yen's rise against the dollar was causing concern.

Currency intervention?

"Exports aren't falling like some people had worried, a downturn there is not the only concern for the Japanese economy," said Kazuhiko Ogata, senior economist at HSBC Securities.

"Instability in the banking sector is eroding domestic demand and there needs to be action on this front while exports are still holding up," he said.

The government is trying to clean up the banking systems backlog of bad loans, but this is being seen by some commentators as a drag on the economy.

At one point on Monday the dollar rose close to 119 yen, prompting talk of intervention.

But traders said it was more a result of nervous, thin trade.

Vice finance minister Zembei Mizoguchi said his ministry would take appropriate action against if yen remained too strong.

"We are closely monitoring and watching the market, taking the view that the yen's excessive strength is not good for the economy."