Most Asia markets fell on Thursday, with shares in Japan stumbling amid fresh yen strength after the Federal Reserve kept interest rates on hold.

The Nikkei 225 was down 1.24 percent as the yen tumbled as low as 105.21 against the dollar in morning trade, compared with levels around 106.25 on Wednesday afternoon local time. At 10:42 HK/SIN, the dollar yen was at 105.35 tapping its lowest levels since late 2014.

The yen's strength came despite jawboning likely aimed at weakening the currency. Japan's chief government spokesman said the yen's moves were being closely watched, calling the appreciation rapid and speculative, according to a Reuters report.

The yen will be in focus today ahead of a monetary policy decision due from the Bank of Japan after 10:00 a.m. HK/SIN.

In South Korea, the Kospi traded down 0.44 percent.

In Hong Kong, the Hang Seng index fell 1.59 percent. Chinese mainland markets were mixed, with the Shanghai composite down 0.1 percent and the Shenzhen composite up 0.4 percent. That followed gains on Wednesday when the markets largely ignored a snub from MSCI, which made the decision to keep mainland listed shares out of its key emerging markets index.

Bucking the trend, Australia's benchmark ASX 200 was up 0.49 percent, with most sectors trading up.

The Federal Open Market Committee held its interest rate target at 0.25-0.50 percent on Wednesday, after a two-day policy meeting.

In its post-meeting statement, the Fed noted that the unemployment rate had declined (to 4.7 percent) but "job gains have diminished." Fed Chair Janet Yellen said in a press conference following the statement release that the Brexit vote, due on June 23, was also one of the factors in Wednesday's decision.

The Fed's dot plot of future rate projections indicated there was still a greater likelihood of two moves before the end of 2016, but doubts have increased that that will happen.

"The level of confidence in that central case view is now less, with six members anticipating only one hike this year," said ANZ's Brian Martin.

Martin added that while all Fed meetings were considered "live," the market pricing for a possible hike in July had fallen to almost zero. "

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First Published:Jun 16, 2016 7:45 AM IST