Asian stocks rallied on Friday as China's central bank chief said Beijing still has enough monetary firepower to keep the world's second-largest economy on track as G20 ministers gathered in Shanghai.
Global equities looked set for their second straight week of gains, with major bourses across Asia pushing higher after US and European stocks rose overnight.
The rally came as officials from the Group of 20 industrialised nations gathered for a two-day meeting in Shanghai, with China's sagging economy expected to loom over the discussions.
Shanghai rose almost one per cent after the head of the People's Bank of China said the economy was strong and signalled authorities could do more to help stimulate growth.
Battered industrial metals prices rebounded, while high yielding currencies including the New Zealand dollar jumped as sentiment improved.
Tokyo added 0.30 per cent after data showing inflation fell to zero in January spurred expectations the central bank could ramp up its massive bond buying programme.
"Markets are rallying ahead of the G20 meeting, boosting risk assets," Wei Wei, an analyst at Huaxi Securities in Shanghai, told Bloomberg News.
"The risk is that investor sentiment is disappointed by the meeting's outcome." Shanghai plunged more than six per cent on Thursday, hit by tightening liquidity and concerns a rally that has added 10 per cent since mid-January was overdone.
Chinese shares have been on a rollercoaster ride since a debt-fuelled bubble burst last year, while cooling growth in the key importer of raw materials has sent commodity and energy prices spinning.
Oil also rose, with the US benchmark trading up five cents at $33.13(S$46) while Brent crude adding 53 cents to $35.24.
Pressure has been mounting for central bankers to let loose their monetary firepower to help stimulate growth and reassure investors after financial markets posted one of the worst starts to the year in living memory.
Japan has already adopted negative interest rates, the European Central Bank has embarked on a huge quantitative easing programme, and the US Federal Reserve has signalled possible delays to interest rate rises.
But Germany's Finance Minister Wolfgang Schaeuble set the stage for disputes at the Shanghai meeting when he said Europe's largest economy opposes any G20 fiscal stimulus package.
"Monetary policy is extremely accommodating to the point that it may even be counterproductive in terms of negative side effects," he said.
Speaking at the same conference, Bank of England governor Mark Carney retorted: "Several commentators are peddling the myth that monetary policy is out of ammunition." In Japan, news that inflation fell to zero in January also raised expectations the Bank of Japan could ramp up its massive central bank bond-buying programme.
The news is a fresh blow for Prime Minister Shinzo Abe after three years of trying to kick-start growth with a raft of policies that includes government spending and a massive central bank bond-buying programme.
Also in Tokyo, shares in Sharp plunged 11 per cent after the parent company of Taiwan's Foxconn delayed signing a definitive agreement to take control of the Japanese electronics maker.
Foxconn said the decision to delay was because of "new material information," which Bloomberg News reported could include more than 300 billion yen of liabilities.
Tokyo - Nikkei 225: UP 0.30 per cent at 16,188.41 points (close)
Shanghai - composite: UP 0.95 per cent at 2,767.21 points (close)
Hong Kong - Hang Seng: UP 2.52 per cent at 19,364.15 points (close)
Euro/dollar: UP at $1.1061 from $1.1023 on Thursday
Dollar/yen: UP at 112.82 yen from 112.15 yen on Thursday
New York - Dow: UP 1.3 per cent at 16,697.29 points (close)
London - FTSE 100: UP 2.5 per cent at 6,012.81 points (close)