The yen has continued its decline against the euro amid weak economic growth, pointing to falling chances the Bank of Japan will increase interest rates in the near future.

Before trading at 163.69 euro this morning, the yen dropped to a record low of 163.76 euro. The Japanese currency traded at 120.26 per dollar while the dollar itself rose against the euro $1.3609.

Currency strategist at RBC Capital Markets Sue Trinh told Bloomberg: "We're sticking with the yen-bearish bias as the outflow from Japan will continue."

She added that analysts were forecasting that the European Central Bank would raise interest rates at least three times throughout the year, in contrast with Japan's low rates.

Meanwhile, the country's gross domestic product data, expected today, is forecast to show a rise of 0.7 per cent over the last quarter, a recent survey conducted by Reuters has indicated.

A trader for a Japanese trust bank told the news source: "If the numbers are good that will probably prompt [Bank of Japan governor] Fukui to say something positive about a rate rise and the key will be whether that stirs any talk about a rate rise in June or July."