Foreign investors, who helped push up Japanese shares to a record high just a few months ago and beat overseas peers, became net sellers for a fourth straight week through June 14
Apart from the BoE, investors will also watch out for central bank decisions from Switzerland and Norway on Thursday to set the tone for global rates outlook
The main market focus in Asian hours on Tuesday was on the Reserve Bank of Australia's (RBA) policy decision, where expectations are for the central bank to stand pat on rates
There was also talk the People's Bank of China (PBOC) could cut a key lending rate by 10 basis points, in part due to surprisingly weak bank lending data released on Friday
The dollar was hovering near a one-month high on the back of the hawkish tone from the Fed this week
Japanese shares underperformed and the yen inched down against the dollar, as the Bank of Japan began its two-day policy meeting
European markets are also set to open slightly higher, with EUROSTOXX 50 futures up 0.3 per cent and the FTSE futures gaining 0.4 per cent
Investor worries of a cooling US economy, however, kept a lid on risk appetite, while the focus in Asia is on how Indian markets fare after stocks sank and the rupee slid
In Europe, investors expect the European Central Bank on Thursday to cut the benchmark rate by 25 basis points to 3.75 per cent
Investors are a lot less dovish on the Fed, seeing little prospect of a move until September and even that is far from a done deal
A downward revision to consumer spending meant the US economy grew more slowly than expected in the first quarter, data showed on Thursday
The latest halt in the global risk rally has come on the back of data pointing to lingering inflationary pressures across major economies
Japan's Nikkei, on the other hand, slipped 0.3 per cent, reversing some of the 0.7 per cent advance a day ago
Data on Thursday showed US jobless claims dropped while S&P Global's Flash PMI survey showed business activity expanded
MSCI's broadest index of Asia-Pacific shares outside Japan lost 0.57 per cent. Australia's S&P/ASX 200 index was one of the biggest decliners
New Zealand's central bank offered a sobering assessment of its inflation problems, warning that rates would have to be higher
Japan's Nikkei was a rare bright spot, rising 0.2%, adding to the previous day's 0.73% rally
Traders are pricing in 47 basis points of easing this year from the Fed, with a rate cut in November fully priced in
Gold marched back toward record levels, and crude oil added to gains after rebounding strongly
China stocks also gained, with blue-chip shares 0.14 per cent higher, while Hong Kong's Hang Seng Index rose 1.4 per cent, having touched an eight month high in early trading