The Japanese yen has dived to its lowest level against the US dollar since August 1998, prompting the government to consider intervention.

The currency pair broke through the key psychological level of 140 yen against the US dollar on Thursday.

While many Asian central banks have raised borrowing costs to match that of the US, Japan has not.

To support economic recovery, the Bank of Japan has maintained ultra-low interest rates, which is one of the reasons the yen has fallen in value against the US dollar and other major currencies.

Higher interest rates are more likely to attract foreign investment, increasing demand for and the value of currencies from higher-interest-rate countries.

Simultaneously, Japanese Finance Minister Shunichi Suzuki said on Friday that the government would take "appropriate" action to stem the yen's decline.

"Excessive, disorderly currency moves could have a negative impact on the economy and financial conditions," Suzuki told reporters.

However, Dwyfor Evans of State Street Global Markets said, as quoted by BBC, that efforts to improve the value of the yen "could prove futile" due to the disparity in interest rates between Japan and the rest of the world.

The Bank of Japan last intervened in currency markets in 2011, following the Fukushima nuclear disaster caused by an earthquake and tsunami.

It is worth noting that the yen was trading around 140.35 against the dollar at midday Friday in Asia.

The yen has been in freefall for months, especially in light of the US Fed aggressively hiking interest rates to try and mitigate the soaring inflation. The current financial situation is expected to maintain its momentum through the coming period as the US grapples with several issues, including the sanctions on Russia that have been causing supply cuts, surging gas prices, and rising food prices.

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