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TOKYO, Dec 11 (Reuters) - Japanese government bonds on Tuesday, with benchmark 10-year yields moving within half a basis point of a 9-1/2-year low hit last week on growing expectations of more monetary easing steps from the Bank of Japan.
* The BOJ will likely take further monetary stimulus action at next week's meeting on Dec. 19-20, most likely by expanding its asset-buying and lending programme, currently at 91 trillion yen ($1.1 trillion). It could expand by another 5-10 trillion yen, according to sources familiar with the central bank's thinking.
* The U.S. Federal Reserve is also expected to announce a new round of Treasury securities purchases at the conclusion of its two-day meeting that will begin later in the session.
* "Further easing by the Fed is expected, but the BOJ will probably act no matter what the Fed does. Ahead of the BOJ meeting, Japan will hold an election, and the outcome will likely boost expectations of more BOJ easing next year," said a fixed-income fund manager at a Japanese asset management firm.
* The opposition Liberal Democratic Party is likely to secure a majority in Sunday's general election. LDP leader Shinzo Abe, who will probably be Japan's next prime minister, has repeatedly called on the BOJ to embark on more aggressive efforts to stimulate the economy and beat deflation.
* Yields on 10-year JGBs shed half a basis point to 0.690 percent, inching close to last week's low of 0.685 percent, their lowest level since June 2003.
Yields on benchmark cash bonds ended 2011 at 0.980 percent.
* Ten-year JGB futures added 0.07 point to end morning trade at 145.26, after touching an intraday high of 145.30, the highest level ever for 10-year futures.
The December contract expires on Tuesday. The March contract rose 0.06 point to 144.77.
The lead futures contract ended 2011 at 142.41.
* The 30-year sector outperformed, as brokers who abstained from buying at last week's 30-year auction covered short positions, market participants said.
Yields on 30-year JGBs fell 1.5 basis points to 1.880 percent.
The 20-year yield was flat at 1.650 percent.