Asian markets were mixed on Wednesday as the Bank of Japan announced it was standing pat on its stimulus programme, even as its policymakers revised down growth expectations for the world's number three economy.
Tokyo's Nikkei edged up 0.11%, or 15.88 points, to finish at 14,304.11.
In line with jittery investors' expectations, the BoJ announced on Wednesday that it was holding fire on expanding its massive asset-purchase scheme as it awaits the effects of a sales tax rise at the start of April.
But after Japanese markets closed the central bank announced that it had lowered its growth expectations for the current fiscal year, fuelling hopes for fresh stimulus measures later in the year.
Hong Kong sank 1.42%, or 319.92 points, to end at 22,133.97, while Seoul slipped 0.15%, or 2.98 points, to close at 1,961.79.
Shanghai added 0.30%, or 6.02 points, to 2,026.36 on the last day of the week's trading before a public holiday. Sydney was flat, nudging up 2.5 points to 5,489.1.
Analysts said Japan would likely be forced to ramp up its monetary easing at some point to counter a downturn.
"While the Bank of Japan left policy settings unchanged today, we still think more easing will be announced in the second half of the year," said Marcel Thieliant, an economist at London-based Capital Economics.
BoJ policymakers, in their closely watched semi-annual outlook gauging the median of members' views, predicted that Japan's economy would grow 1.1% in the year to March owing to tepid data and a sales tax rise introduced on April 1, which has fuelled fears about the nation's recovery.
The prediction marks a downgrade from a previous forecast of 1.4%.
However, the BoJ's view that inflation would come in at 1.3% over the same period was unchanged.
On foreign exchange markets the dollar rose against the yen on expectations of further BoJ easing. In the afternoon the greenback bought 102.56 yen compared with 102.64 late in New York, but well up from the 102.17 yen on Monday in Tokyo when the Nikkei was last open.
The euro fetched $1.3823 and 141.77 yen, against $1.3811 and 141.75 yen in New York on Tuesday.
In New York trade the Dow and S&P 500 enjoyed a second-straight pick-up Tuesday after last week's sell-off, despite a mixed bag of corporate earnings and economic data. The Dow rose 0.53%, the S&P 500 added 0.48% and the Nasdaq gained 0.72%.
Later Wednesday, the US Federal Reserve will complete its own policy meeting, with observers tipping a further cut in its multi-billion-dollar asset purchase scheme as the economy continues to show signs of improving.
Also, Washington will release its initial estimates of gross domestic product growth for the first three months of the year, which saw a severe storm hit most of the country.
Other data due for release this week include manufacturing activity around the world and US non-farm payrolls, which will provide a clearer idea about the country's recovery.
Oil prices were down. New York's West Texas Intermediate for June delivery dropped 80 cents to $100.48 in afternoon trade, and Brent North Sea crude for June eased 32 cents to $108.66.
Gold fetched $1,292.55 an ounce at 0950 GMT compared with $1,290.38 on Tuesday.
In other markets, Kuala Lumpur inched up 0.65%, or 12.18 points, to 1,871.52. Telecommunication company Maxis gained 0.4% to 6.95 ringgit, while IOI Corp rose 2.5% to 5.00.
Manila rose 1.08%, or 71.46 points, to 6,707.91. Philippine Long Distance Telephone led gainers, rising 2.20% to 2,880.00 pesos, while Alliance Global improved by 1.63% to 31.15 pesos.
Taipei fell 0.91%, or 80.67 points, to 8,791.44. Taiwan Semiconductor Manufacturing Co was off 1.66% at T$118.5, while leading smartphone camera lens maker Largan Precision shed 2.84% to T$1,885.
Wellington jumped 1.64%, or 84.39 points, to a record high of 5,232.68. Xero surged 5.54% to NZ$31.65 and Warehouse Group was up 3.35% at NZ$3.39.