Place coconut in a food processor and pulse several times until a fine, chopped consistency. Set aside for a moment.
In a large bowl, beat butter and sugar together until completely creamy, about 3 minutes of mixing. Beat in egg and vanilla until smooth. Combine coconut, flour, baking powder, and salt. Beat flour mixture into liquid until a soft dough forms.
Roll dough into 1-in. balls and place 2 inches apart on a parchment-lined baking sheet. Use your thumb to make a small indentation in each cookie.
Chill dough balls in freezer 10–15 minutes (or in fridge 30 minutes) until dough balls are stiff.
Preheat oven to 350F. Remove dough balls from freezer or fridge and bake cookies at 350F for 11–15 minutes or until edges just begin to brown.
Use the back of a tablespoon to re-indent thumbprints if cookies have lost their thumbprint shape during baking. Cool cookies on baking sheet 10 minutes then transfer to a wire cooling rack.
Spoon lemon curd into thumbprints, being careful not to overfill. Allow to cool completely, then dust cookies with powdered sugar and coconut. Enjoy!