Asia markets trading mixed on Monday, with the Japanese benchmark index falling, as markets adjust to a slew of recent comments from the US Federal Reserve about a possible interest rate hike in June.

Australia's S&P/ASX 200 was down 0.09 percent, wavering between positive and negative territories. Major miners were down in early trade, with shares of Fortescue off 1 percent and Rio Tinto down 0.75 percent.

The Nikkei 225 was down 1.09 percent, with stocks coming under pressure as the yen saw renewed strength against the dollar. Shares' decline was in the wake of data released shortly before the market open showing the country's exports continued to fall.

Across the Korean Strait, the Kospi was up 0.08 percent.

"There are several conflicting cross-currents in financial markets," said Chris Weston, chief market strategist at spreadbetter IG, in a note Monday. "The wash-up is the Fed's message that the world is better than you think, and the market seems to be warming to this view."

The US central bank sent clear signals to the market on Thursday that a June interest rate hike could be on the cards. New York Fed President William Dudley said that June was definitely a live meeting, while Richmond Fed President Jeffrey Lacker echoed the sentiment for a June hike to Bloomberg Radio.

The Fed's April meeting minutes also suggested a rate hike was imminent in June, if economic data pointed to stronger growth in the second quarter.

The dollar will be in focus this week in the build-up to the much-anticipated June Fed meeting.

"The shift in market expectations for Fed tightening and the confirmation from Fed presidents is a significant development that has shifted the market's appetite for dollars," Kathy Lien, managing director for foreign exchange strategy at BK Asset Management, said in a note Friday.

"The dollar lost some of its momentum towards at the end of the week and with a relatively light US calendar next week devoid of major market moving economic releases, we could see choppy trading," Lien added.

The dollar index, which measures the greenback against a basket of currencies, pushed above the 95 level by Friday, compared with the 94 level in the first half of the week. On Monday, as of 7:47 a.m. HK/SIN, the index traded at 95.324.

On the data front, Japan's Ministry of Finance data showed Japanese exports were down 10.1 percent on-year in April, reflecting sluggish demand from China, the emerging markets and the US The decline was mostly in line, with a Reuters poll where economists expected a 10 percent decrease for the month.

Imports for April were down 23.3 percent on-year. The trade balance was 823.47 billion yen.

The dollar/yen pair also gained on Friday, hitting the 110 handle and going as high as 110.58, compared with the 108-109 range it at traded earlier in the week.

"Many economists expected the break of this key level to be driven by weak Japanese gross domestic product numbers, but instead it was hawkish Federal Open Market Committee minutes that sent the dollar soaring," said Lien.

Data released from the government of the world's third-largest economy surprised markets on Wednesday, reporting an expansion in its real GDP for the January-March period at an annualized 1.7 percent. It beat a Reuters poll where respondents expected a 0.2 percent rise.

The yen strengthened after the data, with the dollar-yen pair falling as low as 109.80 from around 110.12 before the data's release.

Export stocks were mostly lower in early trade, with shares of Toyota dropping 1.04 percent and Honda down 0.76 percent, while Nissan added 0.19 percent and Sony rose 0.38 percent.

On Saturday, the US issued a fresh warning to Japan against competitive currency devaluation.

Elsewhere, the Australian dollar traded at USD 0.7223, with Weston saying the Aussie was "supported at USD 0.7210 and consolidation is seen."

"This is the line in the sand for traders and a daily close below here suggests adding to short positions," he said.

US stocks closed higher Friday, with the Dow Jones industrial average up 0.38 percent, the S&P 500 adding 0.6 percent and the Nasdaq composite higher by 1.21 percent.

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First Published:May 23, 2016 7:56 AM IST