The Mexican peso and the Brazilian real rebounded from one-month lows after data showed the number of Americans filing for unemployment benefits fell last week to the lowest level in more than four and a half years.
The data suggested a mild improvement in the US labor market. Most of Mexico's exports are sold to the United States. The positive US data prompted the Mexican peso to gain 0.8 percent to 12.8835 per dollar.
The Brazilian real rose 0.15 percent to 2.0370 per dollar.
"There is less aversion to risk today after the jobless claims data. The numbers have encouraged investors and reduced demand for the dollar," said Mauricio Nakahodo, an economic research consultant with Tokyo-Mitsubishi bank in Sao Paulo.
"The data is helping reverse the negative sentiment of the past few days," he added
In Chile, the peso rose 0.55 percent, after closing the previous session at a two-week low.
BRAZIL YIELDS DROP
Brazil interest-rates futures fell after the central bank cut its base Selic rate to an all-time low of 7.25 percent, saying the rate could remain at that level for a "prolonged period."
Yields paid on contracts maturing in January 2013 fell to 7.094 percent from 7.107 percent on Wednesday's close while those expiring in January 2017 declined to 8.750 percent from 8.871 percent.
Before the central bank decision late on Wednesday, a larger number of investors bet policymakers would need to raise the Selic earlier in 2013 as the economy is expected to pick up, driving inflation higher.
But the central bank said in a statement that the stability of rates for a "sufficiently prolonged period" is the best strategy to bring inflation back to a government target.
"We are reacting to the central bank decision to state that interest rates will remain stable for a long time. It's as if the central bank said: don't worry, even if inflation rises," said Alfredo Barbutti, chief economist at BGC Liquidez brokerage in Sao Paulo.