Asian stocks were mixed on the last trading day of July as investors adopted a wait-and-see approach ahead of the Federal Reserve's policy statement.
Japan's Nikkei closed down 1.4 percent while South Korea's Kospi hovered at 1,914 points in range-bound trade. Amid gainers, Australia's S&P ASX 200 pared gains after hitting a new two-month high and the Shanghai Composite added 0.2 percent.
For the month of July, Australian equities outperformed the broader Asian region with gains of over 5 percent. The Kospi came in second place with a 2.7 percent gain while the Nikkei under-performed to lose 0.1 percent.
(Read more: Is Asia poised for a sharp slowdown?)
Fed in focus
Investors are looking ahead to the statement from Federal Reserve's policy-setting meeting and the first reading of U.S. second-quarter gross domestic product, both due later on Wednesday.
(Read more: Wall Street pros: Fall taper priced in...sort of)
The Fed is expected to maintain its accommodative monetary policy, but investors will be looking for hints on when the central bank might start scaling back on its monthly bond-buying program.
Nikkei declines 1.4%
Japan's benchmark index widened losses as dollar-yen fell below the 98 handle in afternoon trade and as investors digested the latest batch of corporate earnings. The Nikkei has been steadily declining since hitting a two-month high at 14,953 points on July 19.
"The market has turned from exuberance to pessimism after Prime Minister Abe's election. The main focus has been the reluctance of Japanese companies to spend from the windfall of a weaker yen which shows the uncertainty they feel towards the future," wrote Kelly Teoh, market strategist at IG in a note.
(Read more: Here's what could really knock the yen back down)
Camera maker Konica Minolta rallied 6 percent after posting better-than-expected first-quarter results, but Fujitsu fell 3 percent after reporting a net loss and digital pen maker Wacom sank over 15 percent after announcing a 5.5 percent fall in net profit.
Mobile carrier Softbank ended down 1 percent following a 2 percent spike earlier after announcing late on Tuesday that its quarterly profit doubled from the previous year. Battery maker GS Yuasa climbed 7.5 percent on better-than-expected quarterly results.
Shanghai up 0.2%
China's benchmark stock index was unable to close above the 2,000 level for a third straight session as caution set in ahead of Thursday's closely-watched official manufacturing purchasing managers index (PMI).
The official Xinhua news agency reported late on Tuesday that China's Politburo would increase support for the real economy while promoting real estate development. The comments boosted property developers, with China Merchants Property leading gains by 4.5 percent and Gemdale up 3.7 percent.
"Further measures are needed to close the gap between potential and targeted growth. We expect consumption tax reforms, incentives for buying big-ticket items, additional fiscal and infrastructure spending and a RRR cut. We maintain our 7.7 percent growth forecast for 2013," wrote analysts at Credit Agricole in a research note.
Sydney's benchmark index pared gains after rising above 5,080 points to hit its highest levels since May 23 on hopes of an interest-rate cut at next week's Reserve Bank of Australia (RBA) meeting.
Meanwhile, the Australian dollar extended losses to a new two-and-a-half-week low at $0.9011 following Tuesday's comments from RBA governor Glenn Stevens.
"The RBA's optimism seems to have evaporated over the past month, if the speech yesterday by governor Glenn Stevens is any guide. We had already been forecasting a 25 basis-point cut rate cut in August to two-and-a-half percent and with the governor giving the green light for lower interest rates, this now looks a sure thing," wrote analysts at National Australia Bank in a report.
(Read more: How low must the Aussie go before the RBA backs off?)
Among the index's top gainers, Gindalbie Metals and Panoramic Resources added 6 percent each, tracking gains in copper prices.
BHP Billiton eased nearly 1 percent after one of the world's largest potash producers, Russia-based Uralkali, quit a major cartel that controls 43 percent of global exports.
Kospi 0.1% lower
South Korea's benchmark index briefly touched a new two-and-a-half-week high at 1,920 points but closed below those levels as automakers broke their six-day winning streak. Hyundai Motor lost 2 percent while Ssangyong Motor fell 1.6 percent following the previous day's 3 percent rally.
Shipbuilder Daewoo Shipbuilding added 1.2 percent after winning a $520 million deal from the Thai government to to build a frigate ship.
State-owned firm Korea Gas jumped 4 percent on news that gas prices will be hiked up half a percent starting Thursday.
— By CNBC.com's Nyshka Chandran. Follow her on Twitter @NyshkaCNBC