The Thai baht powered to a one-week high and other Asian currencies rose on Thursday, after the US central bank chief said the Russia-Ukraine crisis would not likely derail the policy plans, helping revive some appetite for riskier assets.
Federal Reserve Chair Jerome Powell also backed a 25-basis point hike in March, effectively ruling out the prospect of the feared 50 basis points hike.
The baht, which has lost 1.4% since Russia's invasion of Ukraine last month sent energy prices soaring and increased demand for safe-havens, rose as much as 0.9%.
Mitul Kotecha, a senior EM Strategist at TD Securities, also attributed improving tourism prospects as a potential bright spot for the baht.
"Tourism is a big source of revenue for Thailand and clearly if there's talk of China starting to open the door to outbound tourism, is becomes reality in the months ahead. That bodes very well for the Thai baht," he said.
Malaysia's ringgit also advanced 0.1% ahead of a monetary policy decision. A Reuters poll expects the central bank to hold the overnight policy rate at 1.75%.
Powell, in a testimony late on Wednesday, said the bank was proceeding largely as planned on its interest rate hike cycle, unencumbered by risks from Russia's invasion of Ukraine.
The testimony followed a heavy selloff in risky assets over the last few days, following the military crisis.
As such, markets took Powell's comments as a vote of confidence in the economy, even as the prospect of higher rates supported the dollar.
"That may be the assurances which market participants are seeking, who have been trying to adjust their expectations between geopolitical risks and Fed's policy outlook," says Yeap Jun Ron, a market strategist at IG.
China's yuan inched up against the dollar as investors shifted their attention to the annual parliamentary gathering for more clues on the economic agenda.
Malaysia's stock market rose 0.7%, pulled up by energy, metals and palm oil producers rallying on higher commodity prices.
Supply constraints from Russia's invasion of Ukraine have sent commodity prices soaring, with crude oil futures hitting nine-year highs of $118.22 a barrel, and aluminium and palm oil hitting all-time highs.
Other equity markets in Asia also resumed their upward climb after Wednesday's slump, led by South Korean stocks climbing 1.4%, boosted by its big tech names.
Indian stocks also rose 0.2%, recovering some of the last session's losses.
Markets in Indonesia were closed for a public holiday.
Highlights:
** Singapore's 10-year bond yields rose 76 basis points to 1.888%
** Russia's rouble down 0.4%