Japanese shares jumped over 3 percent while the yen fell as the Bank of

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Japan held an emergency meeting to curb a rise in the Japanese currency that is threatening a fragile economic recovery.

Asian stocks outside Japan rose 1.3 percent, tracking gains on Wall Street on Friday which rose over 1.5 percent on technical-related buying despite dour comments from Federal Reserve chairman Ben Bernanke.

The strengthening Japanese currency, which hit a 15-year high of 83.58 yen against the dollar last week, has taken its toll on the country's exporters, pushing the Nikkei down nearly 20 percent since its peak in early April.

The BOJ is widely expected to loosen monetary policy by expanding its cheap fixed-rate loan programme for banks, which was put in place in December last year and expanded once in March.

BOJ Governor Masaaki Shirakawa will hold a news conference at 2:30 p.m. (0530 GMT) after the meeting. He will also meet with Prime Minister Naoto Kan in the afternoon, Jiji news agency said.

Cabinet ministers are due to decide the basic thrust of additional measures to help the slowing economy at a meeting in later on Monday, Kyodo news agency said, but Japan's huge public debt, now twice the size of the economy, constrains his options.

Some analysts questioned whether the central bank would take steps bold enough to stem a rise in the yen that hurts exports and may delay Japan's exit from deflation.

"Shares of exporters are being buoyed mainly by short-covering after news of the BOJ's emergency meeting prompted buying of dollar/yen, though this policy news may run its course if the meeting doesn't yield major surprises," said Hiroaki Kuramochi, chief equity marketing officer at Tokai Tokyo Securities.

* The yen slipped broadly with the dollar rising to the day's high of 85.75 yen on trading platform EBS, up from around 85.35 yen. The dollar last stood at 85.7 yen, up about 0.6 percent from late trading on Friday.

* The benchmark 10-year Japanese government bond yield jumped more than 10 basis points and the yield curve steepened sharply as longer-dated bonds extended losses in the wake of a jump in Tokyo shares and weaker U.S. Treasuries.

* Gold started its fifth straight week in positive territory ahead of U.S. economic data that could point to further economic softening.

* Light crude oil for October delivery rose 0.48 percent to $75.53 per barrel, heading for the fourth straight session of rises. On Friday prices were boosted by a rally in U.S. stocks as investors shrugged off cautionary remarks by the Federal Reserve chief.