Most Asian currencies took a cautious stance on Thursday as investors await key US inflation data for any clues on the pace of Federal Reserve interest rate hikes, while the rupiah held steady ahead of Indonesia's policy decision.

The Fed is broadly expected to begin raising rates next month although there is no clarity about the pace of tightening.

The rupiah inched 0.1% higher ahead of the country's policy decision, where Bank Indonesia is expected to keep interest rates unchanged at 3.5%.

However, over one third of respondents in a Reuters poll expect a hike as soon as next quarter. Most predicted 50 basis points of tightening in July-September, compared with 25 basis point increases in the third and fourth quarters in a January poll.

"To us, there remains a risk that BI would opt to hike policy rate in March soon after the Fed meeting that might see continued hawkishness," analysts at OCBC Bank wrote in a note.

The Jakarta stock index rose 0.2%.

Most Asian currencies cautious; baht firms on travel bubble talks

The Indian rupee slipped 0.3% after the central bank's key lending rate was held steady at record lows on Thursday, but it surprised markets by leaving the key deposit rate unchanged against some economists' predictions of a hike to re-align it with short-term money market rates.

Other major currencies - the Malaysia ringgit, S. Korean won, Thai baht and Philippine peso - were all broadly flat with greenback index inching lower by 0.05% on Thursday.

Sentiment was similar across most stock markets in the region, with South Korean shares inching 0.2% higher after the country reported record coronavirus cases.

Meanwhile, Malaysian stocks rose 0.8%, while Philippine stocks slipped 0.9%.

Chinese shares also fell 0.1%, dragged by a slump in battery maker Contemporary Amperex Technology and profit-taking in consumer firms.

Highlights

** Top gainers on the Jakarta stock index include Gozco Plantations Tbk PT up 29.55%, PT Wilton Makmur Indonesia Tbk up 24.53%

** Top gainers on FTSE Bursa Malaysia Kl Index include IOI Corporation Bhd up 3.9%, Sime Darby Plantation Bhd up 3.83%.