TOKYO, April 22 (Reuters) - Japanese government bond

(JGB) yields rose on Monday as fears of further escalation in

the Middle East conflict eased, with Iran playing down an

apparent Israeli drone attack within its borders last week and

indicating it had no plans for retaliation.

The response appeared gauged towards averting region-wide

war, and JGB yields, which fell sharply across the curve as

bonds rallied on safe-haven bids last Friday, bounced back.

Yields move inversely to bond prices.

The 10-year JGB yield rose 5 basis points

(bps) to 0.880%, after declining to over a one-week low of

0.825% on Friday.

Benchmark 10-year JGB futures fell 0.48 yen to

144.19 yen.

Meanwhile, as the Bank of Japan's (BOJ) April meeting fast

approaches, BOJ Governor Kazuo Ueda said on Friday the central

bank "very likely" will raise interest rates if underlying

inflation continues to go up.

Ueda also said the bank would begin reducing its huge bond

buying at some point in the future.

Although the content was similar to previous remarks, the

BOJ chief struck a "more positive tone," said Ryutaro Kimura, a

fixed income strategist at AXA Investment Managers.

"It left a clear impression that the BOJ is squarely focused

on the prospect of additional rate hikes in the near future," he

said, adding the chance of a July hike was increasing.

Much of the movement in yields on Monday was due to ebbing

geopolitical concerns rather than a reaction to Ueda's comments,

however, with market consensus still leaning toward another hike

in October, Kimura added.

The two-year JGB yield climbed 2 bps to

0.275%, while the five-year yield was up 3.5 bps

at 0.485%.

On the superlong end, the 30-year JGB yield

was 4 bps higher at 1.920%.