Asian shares got off to a cautious start on Wednesday, holding close to six-month highs on hopes the US Federal Reserve will stick to a dovish stance and unveil a plan to stop cutting bond holdings later this year.

MSCI's broadest index of Asia-Pacific shares outside Japan ticked down 0.1 per cent from a six-month high touched the previous day. Japan's Nikkei was also down 0.1 per cent.

Wall Street shares were narrowly mixed on Tuesday, with the S&P 500 losing 0.01 per cent and the Nasdaq adding 0.12 per cent.

The Federal Reserve, which is wrapping up its two-day policy review later on Wednesday, is expected to lower its policy-makers' rate projections from December, when their median expectations were for two rate hikes this year.

Since the beginning of year, Fed Chairman Jerome Powell has said the central bank would be patient - interpreted as code word for holding off on a rate hike - on signs of slowing economic growth in the US and many parts of the world.

Financial markets have gone even further by pricing in a rate cut this year. Fed funds futures point to about a 30 per cent chance of a cut by the end of year.

The Fed is also expected to lay out a plan to stop shrinking its $4-trillion balance sheet, or so-called quantitative tightening. Many policy makers have suggested the Fed is likely to conclude the process and stabilise its bond holdings by the end of this year.

“I think market consensus centres around an end in September, but we expect the Fed to end its balance sheet roll-off in June, at around $3.85 trillion yen, based on our calculations on the amount of excess reserves the Fed will need,” said Shuji Shirota, head of macroeconomic strategy at HSBC Securities in Tokyo.

Expectations of a dovish Fed have dented the US dollar, which has already been under pressure this year after Powell all but signalled a pause to the tightening cycle at the previous meeting.

The dollar's index against a basket of six major currencies hit 2 1/2-week low of 96.288 on Tuesday and last stood at 96.390.

The euro traded at $1.1354, near Tuesday's two-week high of $1.1362. The dollar fetched 111.41 yen, slipping from Friday's nine-day high of 111.90. The British pound remained hostage to headlines on Brexit.

British Prime Minister Theresa May is expected to ask the European Union to delay Brexit by at least three months after her plan to hold a third vote on her deal was thrown into disarray by a surprise intervention from the speaker of parliament.

May had earlier warned parliament that if it did not ratify her deal, she would ask to delay Brexit beyond June 30, a step that Brexit's advocates fear would endanger the entire divorce.

On the other hand, the EU's chief negotiator, Michel Barnier, has said an extension would only make sense if it increased the chances of May's deal being ratified by Britain's House of Commons.

Sterling last stood flat at $1.3265, off its nine-month peak of $1.3380 hit a week ago.

Market players held on to hopes of a trade deal between Washington and Beijing as officials from both sides remained locked in negotiations.

US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin plan to travel to China next week for another round of trade talks with Chinese Vice Premier Liu He, a Trump administration official said on Tuesday.

Oil prices held close to four-month highs on expectations that OPEC would continue production cuts through the end of the year and after data from the American Petroleum Institute (API) showed a surprise draw-down on crude inventories.

US West Texas Intermediate (WTI) futures stood flat at $59.02 per barrel after touching its highest since November at $59.57 on Tuesday.