The yen fell to a record low against the euro on Thursday following Bank of Japan comments that the pace of interest rate change would remain slow.

The Japanese currency reached a low of ¥159.13 against the euro before clawing back some ground to end at ¥158.81 and fell one percentage point on the dollar to ¥120.97.

Japanese policy makers raised the base rate of borrowing to 0.5 per cent on Wednesday but added that further rises would be constrained by low growth.

"Foreign investors have been hedging currency risk when they buy Japanese shares," Tohru Sasaki of JPMorgan Chase Bank in Tokyo told Reuters. "So their purchases do not impact exchange rates."

Analysts said that a further rate rise remained unlikely in the next six months, meaning that the carry trades that have undermined the yen are likely to continue.

In the US, the dollar was supported by a surprise rise in consumer prices revealed by an economic report on Wednesday.