Focus on Japan and China inflation as Asia-Pacific markets decline after Powell's dovish tone.

• Asian traders will evaluate inflation data from China and Japan's producer price growth.
• On Tuesday, Jerome Powell, the Federal Reserve Chair, voiced concern that prolonged high interest rates could hinder economic growth.

Despite a rise in key Wall Street benchmarks following dovish comments from U.S. Federal Reserve Chairman Jerome Powell, Asia-Pacific markets began lower on Wednesday.

Powell warned that reducing policy restraint too late or too little could negatively impact economic activity and employment.

In Asia, investors will evaluate inflation data from China and Japan, with China disclosing its consumer and producer prices for June.

The PPI in China is predicted to decline by 0.8% in June, while inflation is expected to increase slightly to 0.4% from May's 0.3%.

On Tuesday, Japan's stock market retreated from its all-time high, slipping marginally, while the broad-based Topix was trading close to the flatline.

On Wednesday, South Korea's stock market was 0.25% down, while the small-cap Kosdaq was 0.2% lower. Meanwhile, South Korean defense manufacturer Hanwha Aerospace announced a 1.38 trillion won ($1 billion) order from Romania to supply K9 howitzers to the country.

Australia's S&P/ASX 200 was down 0.28%.

The HSI's last close of 17,523.23 was lower than Hong Kong futures at 17,641.

Ping An Insurance, China's largest insurer, is considering issuing a convertible bond worth up to $5 billion, according to sources.

Tuesday, the S&P 500 reached a new record high in the US overnight after Powell's comments, increasing by 0.07% to 5,576.98 and marking its 36th record close of the year.

The Nasdaq Composite finished the day with a 0.14% increase, reaching a new record, while the Dow Jones Industrial Average decreased by 0.13%.

—CNBC's Brian Evans and Sarah Min contributed to this report.