BANGKOK (AP) — Shares were mixed Wednesday in Asia ahead of a decision by the Federal Reserve on interest rates.

In Japan, higher inflation and falling wages raised questions about how the central bank can navigate away from near-zero interest rates. The Bank of Japan will issue a policy decision on Friday. In March, it raised its benchmark rate from minus 0.1% to a range of zero to 0.1%, the first such increase in 17 years.

The government reported that producer prices rose 2.4% in May, as the yen’s weakness against the U.S. dollar raises costs for imports of fuel and manufacturing components. At the same time, the latest data show real wages adjusted for inflation fell in April for the 25th straight month.

The worry is that the Bank of Japan will be constrained from raising interest rates out of concern that higher prices will depress consumer spending, hurting the overall economy.

Tokyo’s Nikkei 225 index lost 0.7% to 38,876.71.

Hong Kong’s Hang Seng index sank 1.3% to 17,946,46, while the Shanghai Composite index rebounded, gaining 0.3% to 3,037.47.

Australia’s S&P/ASX 200 shed 0.5% to 7,715.50. In Bangkok, the SET was flat.

Gains in technology shares pushed prices higher in South Korea, where the Kospi rose 0.8% to 2,728.17, and in Taiwan, whose Taiex jumped 1.2%.

Trading was subdued Tuesday on Wall Street ahead of a key inflation report and the Federal Reserve’s policy decision.

The S&P 500 rose 0.3% to 5,375.32, driven largely by gains in tech stocks. The tech-heavy Nasdaq composite rose 0.9% to 17,343.55. Both indexes set record highs for the second straight day.

Apple surged 7.3% after highlighting its push into artificial intelligence technology.

The Dow Jones Industrial Average lagged the market. It slipped 120.62 points, or 0.3%, to 38,747.42.

The key events for the market this week come on Wednesday, when the U.S. releases its latest update on inflation at the consumer level and the Federal Reserve announces its latest update on interest rates. The U.S. will also release its latest update on prices at the wholesale level on Thursday.

Wall Street expects the government’s consumer price index to remain unchanged at 3.4% in May. Inflation as measured by CPI is down sharply from its peak at 9.1% in 2022, but it has seemingly stalled around 3%. That has complicated the Fed’s goal of taming inflation back to its target rate of 2%.

The Fed has held its main interest rate at its highest level in more than two decades and Wall Street is currently hoping for one or two cuts to that rate this year. Virtually no one expects the Fed to move its main interest rate at its current meeting, which started Tuesday. Policymakers will be publishing their latest forecasts on Wednesday for where they see interest rates and the economy heading.

When Fed officials released their last projections in March, they indicated the typical member foresaw roughly three cuts to interest rates in 2024. That projection will almost certainly fall this time around.

Data on the economy have come in mixed recently, and traders are hoping for a slowdown that stops short of a recession and is just right in magnitude.

The economy has remained resilient with support from a strong jobs market and consumer spending. Consumers are becoming increasingly stressed, especially those with lower incomes, and retailers have been warning investors about the potential impact to earnings and revenue. The U.S. jobs market has been showing some signs of cooling, which could ease inflation but put more stress on consumers.

Affirm Holdings climbed 11% on news that the buy now, pay later company will be integrated into Apple Pay.

Paramount Global, the media company that owns the Paramount movie studio, CBS as well as several cable networks, dropped 7.8% following reports that talks to merge the company with Skydance Media had fallen apart.

In other trading early Wednesday, benchmark U.S. crude oil climbed 58 cents to $78.48 per barrel in electronic trading on the New York Mercantile Exchange.

Brent crude, the international standard, was up 47 cents at $82.39 per barrel.

The U.S. dollar rose to 157.29 Japanese yen from 157.14 yen. The euro climbed to $1.0745 from $1.0740.