TOKYO, April 28 (Reuters) - Japan's Nikkei share average

slipped from a record high, government bonds swung, and the yen

rallied on Tuesday, after the central bank struck a hawkish tone

as it kept interest rates unchanged.

The benchmark Nikkei 225 Index fell 0.8%

to 60,072.43 as the market reopened after a break to react to

the Bank of Japan's decision. The broader Topix climbed

0.78% to 3,764.51.

The yield on the benchmark 10-year Japanese government bond

rose to as high as 2.48%, near a 29-year peak of

2.49% touched earlier this month, before easing back to 2.465%.

The yen strengthened 0.2% to 159.02.

The BOJ held its policy rate steady, but three of the nine

board members proposed hiking borrowing costs, signalling the

bank's concern about inflationary pressures stemming from the

conflict in the Middle East.

"The outcome of the BOJ policy meeting was a bit hawkish,

with three board members dissenting from the decision, not two.

That weighed on investor sentiment as they braced for an

interest rate hike in June," Kazuaki Shimada, Chief Strategist

at Iwaicosmo Securities, said.

"But the Nikkei's decline today was driven by Advantest and

SoftBank Group. Given their fast-pitched rally in the recent

sessions, the Nikkei's decline after the BOJ's decision is an

appropriate adjustment to the sharp gains of the index."