JGB futures rise in early Tokyo trade amid falling crude oil prices that typically lead to lower inflation in Japan. Investors will closely monitor the BOJ's two-day meeting starting Thursday, where the central bank is widely expected to leave rates unchanged.

"The focus will be on the economic outlook in its quarterly Outlook Report as well as voting behavior," Citi Research's Tomohisa Fujiki says in a research report. Even if a more hawkish stance is confirmed, market reaction will probably be limited, the rates strategist says, noting probability of a rate hike in October increased to above 80% on July 22.

"A further rise seems a way off," Fujiki adds. Benchmark 10-year JGB futures are 0.44 yen higher at Y127.23.