Japan's Nikkei gains, JGB futures rise ahead of expected BOJ rate hike

TOKYO, Dec 19 (Reuters) - Japan's Nikkei share average advanced on Friday and Japanese government bond futures rose ahead of a Bank of Japan policy decision, with markets ?widely expecting an interest rate hike later in the day.

The ?Nikkei gained 0.6% to 49,306.95, as of ?0014 GMT, and earlier jumped as ?much as ?1%.

That followed a 1% drop in the previous session, ?when the index sank to ?a 3 1/2-week low.

The broader Topix added 0.6% to 3,376.67.

Benchmark 10-year JGB ?futures added 0.09 ?yen ?to 133.43 yen. Cash bonds had yet to trade.

The BOJ decision does not come at ?a set time, but is generally between 0330-0500 GMT. BOJ Governor Kazuo Ueda will hold a news conference from 0630 GMT.

A large majority of economists in a Reuters poll ?predicted the ?central bank BOJ will raise short-term interest rates to 0.75% from 0.5%, which ?would mark the first increase since January.

"Economic conditions arguably justified a hike ahead of the monetary committee's October meeting, and recent data only strengthens the case," James Brady, vice president at Teneo, said in a ?note.

"The Bank's long-sought 'virtuous cycle' of wage growth and 2% inflation now appears closer than at any point in ?decades." (Reporting by Kevin Buckland; Editing by Rashmi Aich)