Asian currencies consolidated against the dollar on Thursday, showing limited movement as investors assessed diplomatic developments in the Middle East. Iran held talks with Oman regarding the establishment of a safe shipping route through the Strait of Hormuz, with the Omani foreign ministry indicating a temporary corridor could be announced soon. These discussions, coupled with news that the U.S. is returning diplomats to the region, have eased concerns about escalation in the conflict.

Kristina Clifton, senior economist and senior currency strategist at CBA, noted that the return of U.S. diplomats to the Middle East has helped alleviate market anxieties. The U.S. dollar remained little changed at 159.21 yen and flat at 1.2691 Singapore dollars, while the Australian dollar held steady at US$0.7164, according to LSEG data.