• Shares in Asia-Pacific were mixed on Wednesday.
• China on Wednesday kept its one-year loan prime rate unchanged at 3.7%, while also holding steady on the five-year LPR at 4.6%.
• Investors have been watching for signs of policy support from Chinese authorities as the mainland continues to grapple with its worst Covid outbreak since the initial shock of the pandemic in 2020.

SINGAPORE — Shares in Asia-Pacific were mixed on Wednesday as China defied expectations by keeping its benchmark lending rate unchanged.

Mainland Chinese stocks led losses among the region's major markets. The Shanghai composite closed 1.35% lower at 3,151.05 while the Shenzhen component declined 2.072% to 11,392.23.

Hong Kong's Hang Seng index shed earlier gains and was down 0.44% as of its final hour of trading, adding to its more than 2% Tuesday loss.

China on Wednesday kept its one-year loan prime rate unchanged at 3.7%, while also holding steady on the five-year LPR at 4.6%. A majority of the traders and analysts surveyed in a snap Reuters poll expected a cut in the loan prime rate this month.

Investors have been watching for signs of policy support from Chinese authorities as the mainland continues to grapple with its worst Covid outbreak since the initial shock of the pandemic in 2020.

"I really don't expect, you know, they're very keen to put on the rate cuts … in the near term," said Eva Lee, head of greater China equities at UBS Global Wealth Management's chief investment office.

China's second-quarter growth rate is set to be weak, but authorities are likely to make moves toward ensuring sufficient liquidity in the system rather than flooding it, Lee told CNBC's "Street Signs Asia" on Wednesday.

The Nikkei 225 in Japan climbed 0.86% to close at 27,217.85 while the Topix index advanced 1.03% to 1,915.15.

Australian stocks nudged higher as the S&P/ASX 200 saw fractional gains on the day to 7,569.20. South Korea's Kospi ended the trading day little changed at 2,718.69.

MSCI's broadest index of Asia-Pacific shares outside Japan traded 0.2% higher.

Yen recovers partially against dollar

The Japanese yen traded at 128.58 per dollar, stronger as compared to an earlier low of 129.40 seen against the greenback.

The moves came after the Bank of Japan on Wednesday said it would offer to buy an unlimited amount of 10-year Japanese government bonds at 0.25%. The Japanese yen has been weakening for weeks against the dollar amid expectations the Bank of Japan will lag the U.S. Federal Reserve in normalizing monetary policy.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 100.767 after earlier touching a high above 101.

The Australian dollar changed hands at $0.7417, still lower as compared to levels above $0.745 seen last week.

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures climbing 1.26% to $108.60 per barrel. U.S. crude futures gained 0.95% to $103.53 per barrel.