The expectation in the FX market at the recent general election was that the new government would be less active in selling JPY to try and maintain a certain exchange rate band. The new finance minister in his overnight meeting with US treasury secretary Geithner is quoted as saying that his government will not intervene in currency markets to lower their currency.
This is an interesting but not unexpected statement and it may open the floodgates for some JPY buying by the speculative community. The earlier panic selling in GBP/JPY might well be related to this statement as well as the technical picture.
