Asian markets posted solid gains on Wednesday, with Japanese shares reversing early losses after a Bank of Japan official downplayed the likelihood of an immediate interest rate hike.

The Nikkei 225 closed 1.2% higher, recovering from a 2.5% drop earlier in the session, following comments from BOJ Deputy Governor Shinichi Uchida.

Uchida stated that recent market volatility could influence the BOJ’s rate hike decisions, emphasizing the need to maintain current monetary easing.

Elsewhere, South Korea’s Kospi rose 1.8%, Hong Kong’s Hang Seng increased by 1.3%, and Taiwan’s Taiex surged 3.9%.

These gains followed a period of significant market turbulence, with the Nikkei experiencing its largest daily loss since 1987 earlier in the week, CNN has reported.

Uchida’s remarks led to a 2% surge in the US dollar against the yen, contrasting with the yen’s recent strengthening due to the BOJ’s previously hawkish stance.

Written B.C. Begley