The yen was at a record low against the euro on Monday morning as investors continued to exploit the Japanese currency's low interest rate in the carry trades.

Traders borrowing money in Japan to acquire high-yield assets elsewhere are a major factor in pushing the yen to Monday trading positions of between 168.35 and 168.51 against the euro.

In addition, the US dollar has made back lost ground as the yen fell from 123.34 to 123.65 on the back of strong US economic data last week.

Fund manager Yuuki Sakurai, of Fukoku Mutual Life Insurance, told Bloomberg: "There is no catalyst for yen-buying - the Bank of Japan will raise rates gradually and the yen's weak trend won't change.''

Later this week, the Bank of Japan's governing body is due to meet to discuss interest rates.

Analysts have speculated that any increases will be imposed gradually and will not be dramatic enough to significantly affect the carry trade.