Dollar Strength Caps Asian Currencies Amid Fed Watch

Asian currencies traded in a narrow range on Tuesday as the US dollar remained near its one-month high, reflecting cautious market sentiment ahead of key economic data and central bank signals later this week.

The dollar's strength has limited upside for most Asian emerging market currencies, which have been under pressure from a widening interest rate differential. Regional central banks have largely held steady, with no major policy surprises expected in the near term.

Traders are now focused on upcoming US inflation data and comments from Fed officials for further clues on the rate path. The Japanese yen remained near multi-year lows against the dollar, despite verbal intervention warnings from Japanese officials.