Muscat: The dollar edged lower today of the Federal Reserve's first monetary policy decision under new Chair Kevin Warsh, as persistent optimism over the interim US-Iran agreement boosted risk appetite and weighed on demand for the safe-haven US currency. The yen saw limited gains despite dollar weakness, hovering closer to the range that could trigger intervention, after the Bank of Japan raised rates in line with expectations.

According to Oman News Agency, currency moves were largely subdued early in the Asian session, with investors reluctant to take large positions before the Fed's interest rate decision later today. The euro steadied at $1.1611, while sterling was little changed at $1.3430. The New Zealand dollar edged up to $0.5833.

Against a basket of currencies, the dollar index slipped to 99.53, surrendering some of its safe-haven gains as details of the interim US-Iran agreement to end the war emerged. The yen traded at 160.43 per dollar, keeping traders on alert for possible intervention by Japanese authorities to support the struggling currency.

The Bank of Japan raised interest rates on Tuesday to their highest level in 31 years, a historic step towards normalizing monetary policy, signaling readiness for further tightening as it focuses on curbing price pressures from the energy shock caused by the Iran war. The Australian dollar held steady at $0.7066, after the Reserve Bank of Australia kept its benchmark rate unchanged at 4.35 percent on Tuesday, signaling slower growth while warning it could raise rates again if needed to contain inflation.