SINGAPORE, June 27 Reuters The yen languished near a 38year low on Thursday and struggled on the weaker side of 160 per dollar, keeping markets on alert for any signs of intervention from Japanese authorities to prop up the currency.

In the broader market, the dollar pared some of its gains from the previous session as U.S. Treasury yields eased a touch, though it held near an eightweek high against a basket of currencies.

The yen rose 0.2 to 160.47 per dollar , having fallen to a low of 160.88 on Wednesday, its weakest since 1986.

The Japanese currency has fallen some 2 for the month and 12 for the year against a resilient dollar, as it continues to be hammered by stark interest rate differentials between the U.S. and Japan, which has maintained the appeal of using the yen as a funding currency for carry trades.

In a carry trade, an investor borrows in a currency with low interest rates and invests the proceeds in higheryielding assets.

Still, the yen39;s latest slide past the key 160 per dollar level has kept traders nervous over possible intervention from Tokyo, after authorities spent 9.79 trillion yen 60.94 billion at the end of April and in early May to push the yen up 5 from its 34year low of 160.245 then.

Analysts said while the risk of intervention has increased, Japanese authorities could be holding out for Friday39;s release of the U.S. personal consumption expenditures PCE price index before entering the market. Still, any intervention would likely have…