Japanese Prime Minister Naoto Kan said the yen's sudden rise against the dollar had become a concern and he would continue to watch it carefully, Japanese media reported on Saturday.

Kan said it was yet to be decided how and when he would meet with Bank of Japan Governor Masaaki Shirakawa to discuss the recent surge in the yen, but added: I want to be sure to communicate as necessary (with the Bank of Japan), the Nikkei business daily reported on its website.

It's become a bit of a concern, Kan said when asked about the sudden strengthening of the yen. I want to continue watching it carefully in the future.

Kan's comments came after government sources said the prime minister and the central bank governor may meet as early as next week to discuss the yen's strength and possible responses, although likely options are seen as limited.

The dollar stood around 86.20 yen, more than a yen above Wednesday's 15-year low of 84.72, on the prospect that Japanese officials will increase verbal intervention to try to stem yen gains.

But traders said the yen was likely to gain longer term, because the Group of Seven countries are unlikely to agree to joint foreign exchange market intervention to strengthen their currencies as their own economies are not recovering strongly.

(Reporting by Shinichi Saoshiro; editing by Sue Thomas)

Japan