Japanese markets ended modestly higher after minutes from the Bank of Japan's July meeting signaled that policymakers remain inclined to resume interest rate hikes in the future if economic and price conditions develop as expected.

The Nikkei average rose 0.27 percent to 45,754.93 as 40-year bond yield dropped to a one-month low after strong demand at an auction.

The broader Topix index settled 0.47 percent higher at 3,185.35 ahead of Friday's Tokyo inflation report, which may provide additional direction on the policy outlook.

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