FOR DECADES, investing in the dollar has been perceived as risky by Japanese investors because of what many believed to be the historical trend for the yen to appreciate against the U.S. currency. Attractive features of holding dollars - particularly the higher interest rates on deposits - were often offset by fears the currency would decline against a yen whose value was consistently pushed up by Japan's current-account surplus and the country's relatively low inflation.

Now, the same historical reflection has caused some theorists to see the yen moving in the opposite direction over the long run. Since the Sept. 11 terrorist attacks against New York and Washington, the knee-jerk reaction of the Japanese currency to appreciate has been held back by the authorities' intervention to drive down the yen in an effort to aid exporters.

Rebecca Patterson, a currency strategist at J.P. Morgan Chase Co. in Singapore, said that, for now, diminishing appetite for risk in the global markets is a reason to expect yen appreciation. As risk aversion grows, she said, pressure builds for Japanese investors to repatriate their overseas investments, exchanging other currencies for yen.

Unwinding of so-called carry trades, in which investors borrow yen at low interest rates and use the money to buy higher-yielding dollar assets, also helps puts upward pressure on the Japanese currency, she said. However, the central bank's resolve to check the rising yen will keep the dollar in a narrow range around 120 yen for the rest of year, Ms. Patterson predicted.

But some analysts said that fundamentals pointed to a weaker yen over the long term. For one thing, Japan's current-account surplus, regarded as one of the largest determinants of the yen-dollar rate, has been shrinking.

Many analysts agree that, broadly speaking and over the very long term, a classic theory on international balance of payments holds true with mature economies such as Japan's. According to the theory, a trading nation goes through a cycle from a current-account deficit to a surplus and then back to a deficit. The transition occurs as it evolves from a developing nation to a mature economy.

A developing country typically has a current-account deficit as it imports goods that it cannot make by itself and borrows money for capital investments. As it begins to export, its low wage structure allows it to compete effectively with more developed countries, so it begins to run a merchandise trade surplus although transfers to investors via interest and other payments keep the broader current account in deficit.

A successful developing nation finally begins to post current-account surpluses as the trade surplus more than offsets financial transfers. The country then invests its trade surpluses abroad, creating a net inflow from financial assets.

Eventually, however, this maturing country sees its current-account surplus fall along with its international competitiveness as wages rise and an aging population increases its spending and reduces savings.

In the end, the country's net overseas investments diminish as its trade deficit draws foreign money back into its financial assets. This was the pattern followed by the United States.

Japan's current-account surplus has been on the wane. It has contracted each month since October 2000 on a year-on-year basis. For the first half of 2001, the current-account surplus dropped by 25 percent from the corresponding period a year earlier.

During some months in the past year, the balance of trade in goods and services has dipped in the red, so it was financial transfers that kept the current account in surplus. Indeed, of the ¥5 trillion ($41 billion) in account surplus Japan earned during the first half of 2001, more than ¥4 trillion was net income from overseas investments.

Ms. Patterson said the yen-dollar rate had correlated more closely with Japan's current-account surplus than anything else. "The trend in dollar-yen and Japan's customs exports have moved the same way, on a monthly basis, 68 percent of the time since 1995," she said. "That is, the yen tends to weaken when customs exports fall, and vice versa."

"If the current-account surplus going forward continues to shrink considerably," she continued, "that would, all other things being equal, be big downward pressure for the yen. "

Daisaku Ueno, currency analyst at Nomura Research Institute in Tokyo, said: "On a seasonally adjusted basis, the service and goods account has come to zero. Left alone, there is nothing that pulls the yen higher."

On the other hand, Mr. Ueno said, there are a number of factors working against the yen. The U.S. action to address economic concerns after Sept. 11 was prompt and aggressive while that of Japan was lukewarm. Meanwhile, Japanese pension funds and investment trusts are looking to invest more in overseas securities in the coming year, he said.

While recognizing only the long-term applicability of the classic theory, Mr. Ueno said Japan was following the path of a mature economy. "In the 21st century, Japan may post a trade deficit." He added that the Bank of Japan may be forced to carry out "inflation targeting," a deliberate policy of generating inflation, if prices continue to fall. Creating an inflationary environment would undo another of the long-term factors supporting the yen against the dollar.

"In the mid- to long term, aging, a shrinking current-account balance and the inflation targeting may provide a turning point," he said.

Shinji Takagi, professor of international finance at Osaka University, said that very roughly speaking, the theory on balance-of-payments cycles applied to Japan. "One can say that as a long-term trend, the theory has validity. But it is not a completely accepted theory."

Mr. Takagi argued that for a nation's current-account surplus to shrink considerably and then move into deficit, there has to be another country or group of nations posting growing surplus to match the loss. "Current-account balances of all nations combined must equal zero," he said. "A condition of one country cannot determine it, especially a large country like Japan."

Ken Landon, senior currency strategist at Deutsche Bank AG in Tokyo, said that the yen was likely to decline over the next year because the U.S. economy would probably show a sharp rebound, thanks to the aggressive interest rate cuts by the Federal Reserve Board. Meanwhile, "there is no economic policy that will result in substantial pickup in the Japanese economy," he said.

He said, however, the structural-theoretical explanation was too long-term a phenomenon to fit into currency projections. "Maybe in 20 years, it could apply," he said.