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JGBs mostly inch lower; reaction to Kuroda comments muted

TOKYO, Jan 15 (Reuters) - Japanese government bonds mostly edged down on Monday, though longer maturities were underpinned by the fact that the Bank of Japan maintained the amount of its bond purchases in its buying operations.

The 10-year cash JGB yield added half a basis point to 0.075 percent, while 10-year JGB futures finished down 0.01 point at 150.47.

The market had a relatively muted reaction to comments from Bank of Japan Governor Haruhiko Kuroda, who highlighted improvements in inflation and the economy and helped send the yen to a four-month high against the dollar.

Kuroda said in a speech to BOJ regional branch managers that core consumer inflation was "moving around 1 percent," a slight change from three months ago when he said core consumer prices were around zero.

"The economy is expected to continue expanding moderately," he added, reiterating his optimism on prospects for a sustained recovery even as he pledged to maintain the bank's massive stimulus programme.

The central bank later raised its economic assessment for three of the country's nine regions in a quarterly report issued on Monday.

The 20-year yield also added half a basis point to 0.590 percent.

The 30-year yield was steady on the day at 0.830 percent , while the 40-year yield was flat at 0.990 percent.

In its buying operations, the BOJ offered to purchase 410 billion yen ($3.70 billion) of five- to 10-year JGBs, 190 billion yen of 10- to 25-year JGBs, and 80 billion yen of JGBs maturing in over 25 years, unchanged from respective amounts in previous operations for those zones.

Last week, the BOJ's move to trim its purchases of 10- to 25-year JGBs and 25- to 40-year JGBs by 10 billion yen in each zone raised fears that Japan's central bank could be gearing up to trim its massive stimulus.

($1 = 110.7600 yen) (Reporting by Tokyo markets team; Editing by Biju Dwarakanath)