TOKYO (Bloomberg) - Japanese stocks fell on Friday after a wave of volatility unleashed by the Swiss National Bank's unexpected scrapping of its currency cap sent the yen to a one-month high as demand for haven assets increased.

The Topix index sank 1.6 per cent to 1,354.46 as of 9:01 a.m. in Tokyo, headed for its lowest close in a month and third straight week of declines. The Nikkei 225 Stock Average slid 1.7 pe rcent to 16,818.25.

The yen traded at 116.13 per US dollar after earlier trading below 116 for the first time since Dec. 16. U.S. stocks fell for a fifth day while gold closed above US$1,250 for the first time since September after the Swiss central bank removed a currency cap against the euro.

"Keeping the franc weak against the euro might have been too costly for the SNB, especially with the European Central Bank potentially adding more stimulus," said Juichi Wako, a senior strategist at Nomura Holdings Inc. in Tokyo. "With the yen moving higher for now, Japanese stocks might sputter all of yesterday's gains."

In a surprise statement that sent shockwaves through equities and currency markets, the Swiss central bank ended its cap of 1.20 franc per euro and reduced the interest rate to minus 0.75 per cent on sight deposits. The shift came ahead of a potential announcement next week by the ECB that it will begin buying government bonds, which could weaken the euro.

Futures on the S&P 500 declined 0.5 per cent after the underlying gauge fell 0.9 percent in New York on Thursday. Weak U.S. inflationary data sent the yield on 10-year Treasury notes tumbling to the lowest level since 2011, pushing back expectations of an interest-rate increase.