The Japanese currency has fallen to a new 20-year low against the dollar. Investors are selling the yen and buying the American currency to lock in higher US yields.
The yen weakened to the 133 mark at one point during Tokyo trading on Tuesday. That is the lowest since April 2002.
The yield on the 10-year US Treasury note rose to above 3 percent in New York on Monday, as concerns about an economic slowdown in the country are easing due to better-than expected jobs data.
The yield on the benchmark 10-year Japanese Government Bond in contrast is hovering around 0.25 percent.
The Bank of Japan is trying to keep long-term interest rates from rising as part of its large-scale easing measures. Its steps include unlimited purchases of JGBs on a daily basis.