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Asian shares stumbled to near 2-1/2-month lows on Tuesday and the U.S. dollar pared some of its recent losses as investors worried about the likelihood of a U.S. interest rate increase in coming weeks.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slid 0.5 percent, taking its losses to more than 7 percent so far this month and nearing its lowest levels since March 9.

"The market seems to be taking a cautious stance ahead of the Fed Chair Janet Yellen's speech later this week," said Jung Sung-yoon, a foreign exchange analyst at Hyundai Futures.

Japanese stocks fell on Tuesday as uncertainty on whether Tokyo would intervene to weaken the yen over U.S. objections sapped confidence, while worries over fiscal policy and a pending decision on a sale tax hike sent turnover to its lowest level this year.

The Nikkei share average dropped 0.9 percent to 16,498.76.

Hong Kong shares finished up on Tuesday despite a fall in mainland indexes.

The Hang Seng index rose 0.1 percent, to 19,830.43, while the China Enterprises Index was flat at 8,306.56 points.

China stocks closed lower on Tuesday as resources firms were hit by slumping commodity prices amid worries over China's economic health.

The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 0.8 percent, to 3,063.56, while the Shanghai Composite Index lost 0.8 percent, to 2,821.67 points.

Reference: Reuters