The yen weakened against major currencies as oil prices surged yet again, while the dollar was firm ahead of this afternoon's US durable goods orders report, with the euro dropping back below 1.22 usd. US oil futures jumped above 66 usd per barrel this morning on continued supply concerns and ahead of US petroleum inventories data this afternoon, raising further concerns about the impact on global growth. The yen is typically sensitive to high oil prices given that Japan imports all of its oil, while falls on Asian stock markets today have also dented the Japanese currency, analysts said. The dollar was higher across the board meanwhile, with the euro falling back below the 1.22 usd mark. Despite yesterday's unexpected jump in the German ZEW index of economic expectations, the euro was unable to push above the 1.2250 usd mark, leaving it vulnerable to profit-taking, WestLB analysts said. "The common currency was not able to climb above 1.2250 despite the unexpectedly strong ZEW index, confirming the poor sentiment towards euro/dollar in general," they said. Key for the US currency will be the reaction to this afternoon's US durable goods orders data. The numbers are expected to be weak, but if the dollar manages to weather any negative news, it could suggest that prospects of higher interest rates in the US are coming back to the forefront of the market's mind, benefiting the dollar, analysts said. "The return of market's focus towards interest rate differentials is likely to see the dollar bounce back," analysts at BNP Paribas said. A sharp decline in the euro against the dollar is unlikely for the time being, however, given recent strong data out of the euro zone, they said, with both this afternoon's Belgian confidence indicator later today and the key German Ifo survey released tomorrow expected to show an improvement. Elsewhere, the pound was also weak ahead of the release of the latest industrial trends survey from the Confederation of British Industry, which is expected to give further evidence of the unhealthy state of the UK manufacturing sector.