TOKYO, Aug 7 (Reuters) - Japanese government bond yields

fell on Wednesday, after a senior official of the Bank of Japan

said the central bank will not raise interest rates when the

market is unstable.

BOJ Deputy Governor Shinichi Uchida also said that the

recent strengthening of the yen would affect the BOJ's policy

decision because it reduces upward pressure on import prices,

and therefore overall inflation.

The 10-year JGB yield fell 1 basis point to

0.875%, after hitting 0.905% earlier in the session.

"Uchida's remarks eased the hawkish image of the BOJ. He

clarified that the BOJ is not in a hurry to raise the rates as

the market expected," said Naoya Hasegawa, chief bond strategist

at Okasan Securities.

After the BOJ raised its policy rate to 0.25% at its policy

meeting in July, the market turned cautious about the BOJ's rate

hike pace, driving bets that the policy rate could be raised to

0.5% this year.

Benchmark 10-year JGB futures rose 0.2 yen to

145.1, after falling to 144.55.

The two-year JGB yield, most sensitive to the

BOJ's policy rate, fell 2 bps to 0.265%.

The five-year yield fell 1 basis point to

0.415%.

Yields on super-long maturities rose, with the20-year JGB

yield climbing 2 bps to 1.725% and the 30-year

JGB yield up 2 bps to 2.12%.