TOKYO, Dec 17 (Reuters) - Japan's Nikkei share average

rose on Tuesday, underpinned by the Nasdaq's gains overnight and

a weak yen, although caution set in ahead of central bank policy

decisions in the U.S. and Japan.

The Nikkei had climbed 0.16% to 39,520.06 by the

midday break, while the broader Topix was up 0.01% at

2,738.73.

"Investors refrained from taking active bets as they were

cautiously awaiting the central banks' policy decisions," said

Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence

Laboratory.

The Nasdaq closed at a record high on Monday and the S&P 500

also rose as investors gauged the latest economic data while

looking toward the Federal Reserve's final policy announcement

of the year later in the week to gauge the path of interest

rates.

The Fed is set to conclude its two-day policy meeting on

Wednesday, with markets pricing in a 95.4% chance for a cut of

25 basis points (bps), according to CME's FedWatch Tool.

The yen was subdued on Tuesday, as markets have

pared chances of a Japanese rate hike this week and see a move

in January as more likely.

The Bank of Japan will announce its policy decision on

Thursday and a majority of economists expect it to hold rates

steady at 0.25%. Swap rates indicated a 21.7% chance of a

25-basis-point hike.

A weak yen benefits Japanese exporters, as it inflates the

value of overseas sales.

SoftBank Group rose 3.83% after U.S.

President-elect Donald Trump said the technology start-up

investor would invest $100 billion in the U.S. over the next

four years.

Zojirushi surged 12.88% to become the top gainer on

the Tokyo Stock Exchange's prime market after the household

appliances maker raised its operating profit forecast for the

year to November.

Chip-testing equipment maker Advantest ( ADTTF ) fell 4.6% to

become the worst percentage loser on the Nikkei.