• Shares in Asia-Pacific were lower on Wednesday.
• The U.S. Federal Reserve is expected to raise interest rates on Wednesday for the second time since 2018.
• Markets in Japan and mainland China were closed on Wednesday for holidays.
• Oil prices rose around 3% in the afternoon of Asia trading hours.

SINGAPORE — Shares in Asia-Pacific were lower on Wednesday as investors looked ahead to the U.S. Federal Reserve's interest rate decision expected later stateside.

Hong Kong's Hang Seng index closed 1.1% lower at 20,869.52. Shares of Chinese tech firms listed in the city fell, with Tencent and Alibaba declining 3.05% and 3.74%, respectively. The Hang Seng Tech index dropped 3.29% to 4,264.91.

Elsewhere, the Kospi in South Korea dipped 0.11% to close at 2,677.57 while the S&P/ASX 200 in Australia declined 0.16% on the day to 7,304.70.

MSCI's broadest index of Asia-Pacific shares outside Japan shed 0.42%.

Markets in Japan and mainland China were closed on Wednesday for holidays.

"Asian markets may see choppy trading today with market players bracing for the Fed's expeditious rate hike trajectory and Quantitative Tightening strategy, especially with Fed chair Powell's press conference on tap (which could reveal his views on the recession risk and also the possibility of 75bp rate hikes)," analysts at OCBC Treasury Research wrote in a Wednesday note.

The U.S. Federal Reserve is expected to raise interest rates on Wednesday for the second time since 2018. The central bank is also expected to launch a program to reduce its bond holdings by $95 billion a month starting in June.

The Fed is expected to hike interest rates and slash its balance sheet aggressively over the next 16 months, and majority of the respondents in the May CNBC Fed Survey see the process leading to a recession.

"Given the already high rate of inflation and the recent strong data, I think that the Fed may continue to tighten 'expeditiously' until downside risks to activity materialize, and they start to put downside pressure on inflation," said Blerina Uruci, U.S. economist at T. Rowe Price.

Overnight stateside, the S&P 500 climbed 0.48% to 4,175.48. The Dow Jones Industrial Average advanced 67.29 points, or 0.2%, to 33,128.79. The Nasdaq Composite rose 0.22% to 12,563.76.

Oil rises 3%

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures up 3.09% to $108.21 per barrel. U.S. crude futures climbed 3.28% to $105.77 per barrel.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 103.458 — off levels above 103.6 seen earlier in the week.

The Japanese yen traded at 130.06 per dollar, having traded around the 130 level for much of the week so far. The Australian dollar was at $0.7112, still above levels below $0.708 seen earlier in the week.

— CNBC's Patti Domm contributed to this report.