In currency markets, the Australian dollar took a hit from the RBA's inflation forecast cut, falling as low as $0.7396 after the announcement, compared with levels as high as $0.7478 before it. The currency pair was fetching 0.7388 at 02:30 p.m. SIN/HK time. The pair had been trading slightly above $0.77 before the RBA surprised markets on Tuesday by cutting rates to a record low 1.75 percent.
Paul Dales, chief Australia economist at Capital Economics, said he expects the Australian dollar will fall at least as low as $0.70.
"The clear implication is that monetary policy will need to do more to boost underlying inflation," he said in a note Friday. "It is looking increasing likely that interest rates won't be raised at all next year," with a cut to at least 1.5 percent or lower likely.
In Australia's stock market, energy shares weighed the index, with the energy subindex down 1.3 percent, while the financials subindex shed 0.2 percent. The losses were offset by gains in the materials subindex, which was up 1.02 percent.
Macquarie Group shares fell 0.31 percent after the bank posted a record full-year net profit, up 62.5 percent from the year before, and raised its dividend by 21 percent to A$4 per share on Friday. The stock has been one of the worst performers on the ASX 200 this year, mostly due to concerns about its commodities exposure, reported Reuters. The Australian investment bank also issued earnings guidance that was in line with last year's numbers.
"I think [Macquarie's flat guidance] is prudent...equity markets are volatile and Macquarie has leverage to both equity and commodity markets," Alex Leyland, portfolio manager at Leyland Private Asset Management, told CNBC's "Street Signs".
Most major Australian banks were down, with the exception of Westpac and National Australia Bank, which were 1.02 percent and 1.26 percent higher respectively.
Ahead of the U.S. data, the U.S. dollar index, which measures the greenback against a basket of currencies, hovered around 93.711, after dipping under 92 earlier this week to test the lowest levels since January 2015.
Angus Nicholson, a market analyst at spreadbettor IG, said the greenback's moves could be key for the direction of markets.
"Markets at the moment are increasingly looking like they may be ready to roll over," he said in a Friday note. "The two decisive factors that could cause an equity market sell-off would be a sustained rally in the U.S. dollar and a sell-off in oil prices, both of which have usually induced weakness in equities of late."
U.S. crude futures fell 0.79 percent to $43.97 a barrel, after rising 1.2 percent in the U.S. Thursday session, while Brent futures were lower by 0.53 percent at $44.77 after settling up 0.9 percent in the previous session.
Energy shares were lower in Australia, with Origin Energy down 3.42 percent and Santos lower by 4.64 percent. Hong Kong-listed shares of Petrochina fell 3.25 percent.
Major resource producers were mixed, with Rio Tinto down 0.65 percent, while Fortescue Metals and BHP Billiton were up 2.64 percent and 0.16 percent, respectively.
In other currency moves, the U.S. dollar/Japanese yen currency pair was at 107.12 at 2:34 p.m. SIN/HK time, down from levels over 111.50 last week. The currency pair this week tapped its lowest levels since October 2014, when the Bank of Japan launched its second massive round of quantitative easing.
"Given the perceived policy contrasts between the BOJ and the Fed, look to the dollar-yen to continue to manifest shifting FOMC expectations," said Emmanuel Ng, FX strategist at OCBC Bank, said in a Friday note, ahead of the Fed's non-farm payrolls report.
In the U.S. on Thursday, the Nasdaq composite finished down 0.18 percent. The Dow Jones industrial average and the S&P 500 closed nearly flat.
— Follow CNBC International on Twitter and Facebook.