The S&P/ASX 200 index snapped four sessions of gains and retreated 1% to 7,294.3 points, as of 0016 GMT. The benchmark closed 0.5% higher on Tuesday.
In his testimony, Powell confirmed that a recent spate of generally robust economic data, particularly in the labor market, along with stubbornly slow inflationary cool-down, increased the likelihood that the Fed will raise its policy rate more aggressively. Investors are now assessing the possibility of a half-percentage-point hike in the Fed's upcoming meeting after Powell's comments.
In contrast, Reserve Bank of Australia (RBA) Governor Philip Lowe said the central bank was closer to pausing its aggressive cycle of rate hikes as policy was now in restrictive territory and there were signs the economy was responding. Lowe's comments came a day after the RBA lifted its cash rate by 25 basis points to the highest in more than a decade at 3.6%, a 10th straight hike since last May.
Energy stocks led losses on the benchmark with a 5% drop after oil fell by $3 a barrel overnight. The sub-index was set for its worst day in more than five months. Sector major Woodside Energy slipped 7.6%.
Mining stocks slumped 1.3% with heavyweight miners BHP Group and Rio Tinto losing 0.2% and 0.5%, respectively.
Gold stocks dropped 3.6% after bullion prices fell more than 1%, while financial stocks retreated nearly 1%. In other news, shares of Australia's Carsales.com Ltd were on a trading halt after the company said it was seeking to raise A$500 million ($329.40 million) to acquire an additional 40% stake in Brazil-based automotive digital marketplace Webmotors SA.
New Zealand's benchmark S&P/NZX 50 index retreated 0.4% to 11,872.76 points.
($1 = 1.5179 Australian dollars) (Reporting by John Biju in Bengaluru; Editing by Sherry Jacob-Phillips)
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