The yen hit a year-high against the dollar on Wednesday as the first U.S. presidential debate between Kamala Harris and Donald Trump got underway in a tight race ahead of November's election.
Traders are also anxiously awaiting the key inflation report, which could provide clues on the size of the US interest rate cut next week.
The yen also received a boost from comments from Bank of Japan board member Junko Nakagawa, who reiterated in a speech today that the central bank will continue to raise interest rates if the economy and inflation move in line with its expectations.
The dollar fell about 0.68 percent to 141.50 yen, a level not seen since Jan. 2, before last trading at 141.83 yen by 0149 GMT.
Both currencies tend to track the yield on the 10-year US Treasury note, which continued to fall overnight, reaching 3.635 percent for the first time since June last year.
Shoki Omori, senior analyst at Mizuho Securities in Japan, said Harris appeared to gain confidence in the debate and clearly outlined her economic policies.
Meanwhile, Nakagawa said real interest rates remain low and thus there is more room for monetary policy tightening.
Omori said the comments pushed the yen higher.
The euro rose 0.16 percent to $1.1038, recovering from an overnight drop to $1.10155 for the first time since Aug. 19.
The pound also rose to $1.3089 after falling to $1.3049 in the previous session, its lowest level since August 21.
The dollar index, which measures the greenback's performance against six rival currencies, fell 0.15 percent to 101.49 after rising to a one-week high of 101.77 on Tuesday.
The Federal Reserve is widely expected to cut interest rates on September 18 for the first time in more than four years, but traders are divided on the size of the cut.
The U.S. consumer price index is expected to rise 2.6 percent on an annual basis in August, according to a Reuters poll, down from 2.9 percent in July.
