The US dollar's advance stalled on Thursday after benign US inflation data overnight prompted traders to reduce bets on a near-term Federal Reserve rate hike. US consumer prices rose 0.1% in July, in line with expectations, and CME Group's FedWatch tool showed odds of a September rate hike fell to 40% from 54% a week earlier.

The dollar index was flat at 100 on Thursday but on course for a 0.4% weekly gain. The dollar traded at 159.44 yen, near the 160 level targeted by recent joint US-Japan intervention at month's end that had pulled the rate down from near a four-decade peak of 164. Michael Wan, currency strategist at MUFG, said the Fed is likely to hold rates steady in September rather than raise them, weighing inflation risks against a softening labour market after July payrolls fell short of forecasts.

The euro was little changed at $1.1523. Sterling eased 0.05% to $1.3489 ahead of UK GDP data. The Australian dollar fell 0.2% to $0.7049, while the New Zealand dollar slid 0.4% to $0.5832.

– Reuters Channel NewsAsia business reports.