"Today's movement is largely driven by the dollar rebound," Sim Moh Siong, FX strategist at Bank of Singapore, said. Sim said the dollar's rebound likely is short term and it should taper because global recovery should continue to keep the currency softer. But if US payroll numbers due on Friday are strong, "there could be a bit more dollar strengthening," he added.
Among Asian currencies, the Philippine peso saw its biggest drop in more than three weeks, falling as much as 0.2 percent to 49.930 to the dollar. Philippine consumer prices likely increased in December at the same annual pace as in November, a Reuters poll showed. December inflation data is due on Friday. The Malaysian ringgit shed as much as 0.3 percent against the dollar. Malaysia is unlikely to meet earlier targets it set for a balanced budget by 2020, the second finance minister said.
The Thai baht and the Indonesian rupiah were among Thursday's few gainers among Asian currencies. Both currencies rose about 0.2 percent against the dollar. Thailand and Indonesia, which are both major commodity exporters, have seen their economies benefit from a recent uptrend in oil prices. "Rising oil prices will be positive for commodity driven currencies," Sim of Bank of Singapore said.
Oil prices on Thursday remained near levels last seen in late 2014/2015, with markets tightening amid tensions in Iran and due to ongoing Opec-led production cuts.