The Japanese yen traded near its lowest level in four decades during Asian trading today, amid market anticipation of potential government intervention to support it, despite the US-Iran agreement and Japan's interest rate hike.

The yen rose 0.1% to 161.205 against the dollar, after hitting a two-year low in the previous session, as liquidity remained thin due to holidays in the US and several Asian markets.

Neither the Bank of Japan's interest rate hike to a 31-year high nor the Finance Ministry's earlier dollar-selling interventions failed to stem the yen's decline, reinforcing expectations of further intervention.

In other currency markets, there were limited movements with little change, as the dollar index, which measures the strength of the US currency against a basket of six currencies, held steady at 100.81. Sterling was at $1.3205 after the Bank of England kept interest rates unchanged at 3.75%, while the euro was at $1.1459. The Australian dollar fell 0.1% to $0.7011, while the New Zealand dollar was at $0.5756.