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Asian shares tracked overnight Wall Street gains in early trading on Friday as fears of an economic slowdown cooled and sterling began to claw back recent losses following British Prime Minister Boris Johnson's decision to resign.

Japan's Nikkei index was up 1.23% at 26,817.24 in morning trade, its highest mark since June 29th.

MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.8% to its highest level in a week, and South Korea's KOSPI index was up 1.18% and set for its best week in five months.

All three major U.S. indices made gains overnight on positive signals from Federal Reserve officials. Governor Christopher Waller called recession fears "overblown," while St. Louis Fed Bank President James Bullard said he saw a "good chance" of a soft landing for the economy.

Waller suggested the Fed would likely attempt to tackle inflation with a 75-basis-point interest rate hike in July and a 50-basis-point hike in September. Though he said, "if inflation just doesn't seem to be coming down, we have to do more," allowing for possible future 25-basis-point hikes.

This provided some relief to share markets after recent heavy sell-offs caused by fears global central banks will push economies into recession to curb runaway inflation. The Asian regional benchmark is still down 16% so far this year.

The latest indicator of the health of the U.S. economy is due later in the day with the release of U.S. non-farm payrolls data. The consensus expectation is for 268,000 jobs to have been added in May.

"How the market will react to deviations from this expectation is debatable," said ING's Robert Carnell and Iris Pang in a client note. "You could argue that a stronger figure will mean the Fed has more work to do, and so raises the prospects of a harder landing. But sometimes the market reaction is more simplistic than you might imagine."

Sterling rose 0.22% to 1.20530 and is now essentially back where it was at the beginning of the week after experiencing a rocky few days amid British political turmoil.

"In our view, GBP is likely to soon unwind its gains given the weakening prospect of the U.K. economy," said Commonwealth Bank of Australia currency strategist Carol Kong.

Oil prices were down in morning trading after having rebounded overnight. Brent crude futures fell 34 cents to $104.33 a barrel, while U.S. WTI crude was down 39 cents to $102.34.

U.S. Treasury yields were flat, with the yield on benchmark 10-year notes at 2.9982% and the two-year yield at 3.0182%.

Bitcoin jumped 3.03% to $22,268.55, its highest price in more than three weeks. It is up nearly 15% this week, on course for its best week since early May.