Between mid-December and early January, yields on Japanese government bonds rose further to reveal the market concern over the deterioration in the supply-demand balance due to the planned massive issuance. Stock prices weakened, reacting to the appreciation of the yen and the rise in the long-term interest rates.
Now, it is well known that in the long run the exchange rate depends on economic fundamentals like inflation, interest rates, balance of payment position, etc., but in the short run there can be significant deviations in the exchange rate from the value dictated by the fundamentals.