By Lisa Twaronite
TOKYO (Reuters) - Asian shares firmed on Wednesday after earnings-fuelled gains on Wall Street, while the euro remained under pressure after weaker-than-expected German inflation data raised speculation of more easing in Europe.
Investors stayed cautious before central bank decisions from the Bank of Japan and then the Federal Reserve later in the session, as well as key U.S. jobs data on Friday.
MSCI's broadest index of Asia-Pacific shares outside Japan added 0.1 percent in early trading, while Japan's Nikkei stock average rose 0.8 percent after Tokyo markets were closed for a holiday on Tuesday.
U.S. equities got a lift on Tuesday from earnings results from companies including Merck & Co, and a rebound in Facebook and other high-growth shares.
Later on Wednesday, Fed officials are expected to decide unanimously at the conclusion of their two-day meeting to continue tapering the central bank's massive bond-buying stimulus. Investors will focus on what their statement implies about the monetary policy outlook.
"For the most part we expect the statement to remain virtually unchanged. Having just shifted to qualitative guidance in March, the central bank is not planning to make any significant alterations in the near future," said Kathy Lien, managing director of FX strategy at BK Asset Management.
"Expectations for steady taper explain the dollar's muted reaction to positive and negative data," she said in a note to clients.
Against the greenback, the euro steadied at $1.3812 after losing 0.3 percent on Tuesday. Against its Japanese counterpart, the euro inched down to 141.66, after shedding 0.2 percent the previous day.
Preliminary German data showed annual inflation was a softer-than-expected 1.1 percent in April. European policymakers are concerned about the risk of deflation, with euro zone prices rising around 0.5 percent, well below the European Central Bank's medium-term target of just below 2 percent.
The latest price report due later on Wednesday is expected to show euro zone inflation picking up to a still-low 0.8 percent in April.
The dollar was slightly lower against the yen at 102.57, but remained in sight of a three-week high of 102.79 yen hit on Tuesday. Against a basket of currencies, the dollar edged down to 79.794.
The BOJ is expected to unanimously stand pat on policy, and will also release new economic projections following its meeting. Japan's central bank policymakers will likely keep their inflation forecast for fiscal 2015 roughly unchanged from the current 1.9 percent, and estimate fiscal 2016 inflation close to 2 percent, sources have told Reuters.
In commodities trading, spot gold was steady on the day at $1,295.80 an ounce. U.S. crude slipped 0.7 percent to $100.58 per barrel.
(Editing by Chris Gallagher)