TOKYO: The yen hit fresh multi-month highs against the euro and dollar in Asian trade Thursday as nervous traders flocked to the safe haven Japanese currency amid worries over Spain's faltering bank sector.

The euro bought 97.47 yen in Tokyo, down from 97.76 yen in New York on Wednesday and its lowest since January 16 when it changed hands at 97.02 yen.

The euro has not fallen below the 97-yen level since 2000.

Meanwhile, the dollar weakened to 78.73 yen, against 79.06 in New York and its lowest level since February 17 when it hit 78.53 yen.

The euro bought $1.2373, up slightly from $1.2366 in New York.

The rise of the yen, which reached historic highs against the dollar last year, prompted fresh concern Thursday from Japan's finance minister, who has previously warned about further market interventions to tame the unit's value.

“This is not reflecting the state of Japan's economy. It's a little speculative,” Jun Azumi said, as official data released Thursday showed anaemic factory output growth of just 0.2 per cent for April.

Dealers are flocking to currencies seen as safe-haven investments, particularly the yen, as eurozone fears sent Spanish and Italian bond yields higher.

“As the European situation is growing increasingly severe, it's likely that yen-buying pressure will increase,” Sumino Kamei, senior analyst at the Bank of Tokyo-Mitsubishi UFJ, told Dow Jones Newswires.

Eyes on Spain, which is battling to contain fears of financial collapse and scrambling to fund a major banking rescue as its debt risk premium rocketed to a euro-era record.

The interest rate on its 10-year bonds Wednesday shot to 6.703 per cent -- unsustainable over the longer term -- as the nation fought to avoid being the next victim of the eurozone crisis.

Compared with safe German debt, investors in Spanish bonds were demanding an additional 5.41 per centage points in interest.

Spanish banks, hugely exposed to a property market that crashed in 2008, are at the heart of market concerns.

In debt-riddled Greece, opinion polls Wednesday showed rival pro-bailout and anti-austerity parties vying neck and neck in June 17 elections that could determine the nation's eurozone future.

The dollar firmed against most other Asian currencies.

The greenback advanced to 1,180.58 South Korean won from 1,177.40 won on Thursday, to 43.56 Philippine pesos from 43.50 pesos, and to 31.89 Thai baht from 31.79 baht.

It also firmed to Tw$29.85 from Tw$29.69 and to Sg$1.2817 from Sg$1.2797.

But the unit fell to 9,605.00 Indonesian rupiah from 9,630.00 rupiah.