Muscat: The yen weakened today, approaching its lowest level in nearly four decades as the dollar rallied on higher oil prices and rising US Treasury yields, keeping traders on alert for possible Japanese intervention. The yen touched 163.24 per dollar in New York trading - its weakest since late 1986 - and steadied at 163.21 in early Asian trade.

According to Oman News Agency, the dollar rose broadly, briefly pushing the euro below $1.14, and held its gains as US forces launched airstrikes on Iran for an 11th consecutive night. The euro last traded at $1.1401, while the Australian dollar held above 70 cents, and the New Zealand dollar steadied just above its 200-day moving average at $0.5825.

Sterling fell below its 200-day moving average at $1.3385, as traders weighed how new UK Chancellor John Healey plans to fund spending. Brent crude futures hit a six-week high of $91.99 a barrel, while US Treasury yields climbed, pushing the 30-year yield to a two-month high of 5.15 percent.

The benchmark 10-year yield touched its highest since May at 4.64 percent overnight and held around that level in early Asian trade, adding pressure on the yen. Low interest rates and recent concerns over Japan's fiscal position have driven the yen's sustained decline over the years. Japan intervened heavily in the currency market in April and May after the dollar-yen exchange rate breached the 160 level.