Finance Minister Sadakazu Tanigaki on Tuesday called the surge of the yen against the dollar "speculative" and vowed to fight excessive fluctuations in the currency market.

The dollar has been skidding against the yen since late last year and hit a three-year low of 106.07 Monday in New York. That was the greenback's lowest level against the yen since September 2000.

"Recent movements appear to be a bit speculative," Tanigaki told reporters. "There is no change to our stance in that we will take proper action when the market moves rapidly."

Tanigaki did not specify a desirable level for the yen, but his comments indicated Tokyo would continue its policy of selling off Japanese currency to bolster the dollar.

Investors in Tokyo's stock market have watched the yen's rise with concern, as a stronger yen decreases the competitiveness of Japanese products overseas and makes dollar earnings worth less when brought back home.

Last year, Japanese authorities sold a record 20.05 trillion yen to try to keep the currency competitively weak for Japanese exporters. The Finance Ministry is believed to be gearing up for a bigger battle against yen strength by bolstering reserve funds for intervention.

"It's important that foreign-exchange rates reflect economic fundamentals and move stably," Tanigaki said.

On Monday, the Bank of Japan was estimated by traders to have bought $3 billion to $5 billion.