Asian shares were mostly lower on Thursday after U.S. stocks stalled as investors awaited developments in the Middle East.
The U.S. dollar gained against the Japanese yen as officials downplayed the likelihood of an interest rate hike soon.
That helped push Tokyo's Nikkei 225 index higher. It gained 2% to 38,552.06, while the dollar traded at 146.
51 Japanese yen, up from 146.41 yen late Wednesday. The dollar had been trading around 142 yen after the ruling Liberal Democrats chose Shigeru Ishiba to head the party and succeed Fumio Kishida as prime minister.
Ishiba had expressed support for the central bank's recent moves to raise its near-zero benchmark interest rate, which stands at around 0.25%. That led traders to bet that the yen would gain in value.
But after a meeting between Ishiba and Bank of Japan Gov. Kazuo Ueda, both officials indicated that the central bank did not view further rate hikes as suitable for the economy at this time. That prompted a flurry of selling of yen, which benefits big export manufacturers.
The meeting between Ishiba and Ueda had not been expected to bring major news, however, “when Ishiba hinted that growing global risks should keep the BOJ firmly grounded, yen bulls hit the exits faster than you can say ‘sayonara,’” Stephen Innes of SPI Asset Management said in a commentary. Elsewhere in Asia, Hong Kong's Hang Seng dropped 1.4% to 22,124.
37 as investors sold shares to lock in profits after it roared 6.2% higher a day earlier on a wave.