Despite Tuesday night's incident, the Astros insisted that the move was about baseball and not the right-hander's behavior.
"We need to get his pitching right," Hinch said Wednesday. "He's had an up-and-down season. He's had signs that things are good. He's had some bad games. He's had some meltdowns. But we need to get him right. He's not right and we've got to get him right mentally and physically to make sure he's a good contributor to a pen."
The Astros were up by four to start the ninth inning against Oakland on Tuesday night when Giles took over and gave up three straight singles, which cut the lead to 4-1.
Hinch came to the mound to take out Giles and the television broadcast caught him appearing to curse at Hinch right after he walked by him on his way off the field. The Athletics tied the game in the ninth, but Houston went on to win the game 6-5 in 11 innings.
It was the second major outburst of the year for Giles, who punched himself in the face as he left the mound after a bad performance earlier in the season.
The 27-year-old Giles, who is in his third season in Houston after a trade from Philadelphia, is 0-2 with a career-high 4.99 ERA in 34 appearances this season. He has only one save in nine appearances since June 17.
Hinch said that Giles was "frustrated" with the demotion and added that he didn't specifically talk to him about what he appeared to say to him on his way off the mound.
Hinch though did acknowledge that he needs to handle himself better when things don't go his way.
"It's important for him to get himself right, where he's directing all of his attention toward the hitter and all of his attention toward his job," Hinch said. "He pitches with a lot of emotion, and when things are going well we love it. When things aren't going well we have our concerns, just because of the volatility of the end-of-the-game type stuff."
Hinch added they want Giles to work on his breaking ball in the minors because it hasn't been as good as in the past. They also hope he sorts out some things with the usage of his fastball.
Despite his struggles, Giles has converted all 12 of his save opportunities this season after converting 34 of 38 last season when he had a 2.30 ERA in 63 games.
Giles' troubles date back to the playoffs last season. He went 0-2 with an ERA of 11.74 in 7⅔ innings. He allowed five earned runs in 1⅔ innings in the World Series against the Dodgers.
The Astros hope that he can fix his problems and return to help them as they chase a second straight World Series title.
"Ken Giles was optioned so that he has an opportunity to go work on some things he needs to work on," general manager Jeff Luhnow said. "He has not had the success up here this year that he's had in the past or that he's capable of having."
The Astros called up left-hander Cionel Perez from Double-A Corpus Christi to take Giles' spot.
The Astros were 30 games over .500 and had a four-game lead in the American League West entering Wednesday's play.
Information from The Associated Press was used in this report.