Finance Minister Masajuro Shiokawa on Friday tried to talk down the value of the yen, saying he believes it is slightly overvalued.
At the same time, he denied that the government is waging a campaign to push down the yen's value.
"I think the yen rate is still a bit too high," Shiokawa said at a news conference, adding that "the government is not trying to artificially maneuver" the currency.
The Finance Ministry has said it dumped 2.4 billion yen onto foreign-exchange markets in the first three months of this year.
"I think currencies should move to an appropriate level from the viewpoint of purchasing-power parity and economic fundamentals," Shiokawa said.
Purchasing-power parity is a measure of foreign-exchange rates based on how many units of each currency it takes to buy the same group of goods and services.
But like all commodities, the value of currencies is determined by supply and demand. The upward pressure on the yen stems from the country's massive trade surplus, as all those exports eventually have to be paid for in yen.
By dumping yen onto the market and lowering its value, the government is able to subsidize bigger profits for Japan's exporters.