"It's a question of the BOJ showing that it is being considerate" to JGB market participants, said Mitsubishi UFJ Morgan Stanley Securities strategist Katsutoshi Inadome.

WSJ: Rising Japan Bond Yields Underscore BOJ's Challenge

"The biggest reason for the decline in gross domestic product (GDP) is external demand was weak and domestic demand did not recover as quickly as we thought, " said Shuji Tonouchi of Mitsubishi UFJ Morgan Stanley Securities in Tokyo.

BBC: Japanese economy contracts for third straight quarter

Japan's Mitsubishi UFJ and Morgan Stanley decided to merge their Japanese securities units, creating one of Japan's biggest brokers.

ECONOMIST: Business this week