The dollar nursed losses on Thursday after posting its biggest loss in five months in the previous session, as investors dialed down expectations on the outlook for U.S. interest rate hikes next year based on minutes from the Federal Reserve's latest policy meeting.
With Chinese stocks down between 2-3 percent in Asian trade, low yielding currencies such as the Japanese yen and the Swiss Franc remained firmly supported against the greenback as investors shied away from taking positions in a holiday-shortened week.
"While a December U.S. rate hike seems to be baked in the cake, markets are getting concerned about a possible downgrade in expectations in the outlook for rate hikes next year after the latest minutes, which is weighing on the dollar," said Kit Juckes, a macro strategist at Societe Generale in London.