* Bank of Japan refrains from further policy easing
* Euro zone worries, softer U.S. data may boost yen demand
* Euro slips as Spanish, Italian yield spreads widen
By Nia Williams
LONDON, April 10 (Reuters) - The yen hit a one-month high against the dollar on Tuesday after the Bank of Japan opted not to loosen monetary policy further, and the currency looked likely to hold its gains in the near term as concerns about U.S. growth weigh on Treasury yields.
The euro sank to a one-month low versus the yen and hovered near a one-month trough against the dollar on growing concerns about euro zonesovereign debt problems. Analysts said further rises in Spanish and Italian bond yields could weaken the single currency further.
The dollar was last down 0.4 percent against the yen at 81.16 yen, having earlier slipped to 81.05, its lowest since early March. The euro was down 0.6 percent at 106.20 yen, near an earlier low of 105.97 yen.
The safe-haven yen gained after the Bank of Japan held off from taking any new steps at Tuesday's meeting ahead of a more thorough assessment of the economy later this month.
This helped the yen add to its gains against the U.S. dollar since Friday, when weaker-than-expected U.S. payrolls fuelled speculation the Federal Reserve may consider another round of quantitative easing to boost growth.
Such speculation has dampened U.S. Treasury yields , which surged last month on tentative hopes of improving U.S. growth, denting the allure of the dollar.
"Even looking beyond the BoJ and Japanese policy, the global environment suggests dollar/yen will stay under pressure," said Ian Stannard, head of European FX strategy at Morgan Stanley. He said Morgan Stanley was looking for a move back to about 80 yen.
He added that the euro could move significantly lower against the yen given rising euro zone debt concerns and that he would look for a move into the 102 yen area.
However, analysts said the yen's gains are likely to be capped by speculation of further stimulus from the BoJ when it issues new forecasts on the economy on April 27. Japanese growth is still fragile and consumer inflation around zero.
"In the absence of anything fresh from the BoJ and in a world where things are looking a bit cloudier the yen should strengthen," said Simon Derrick, head of currency research at Bank of New York Mellon.
"But there will be heightened pressure on the BoJ to do something and I wouldn't be betting on massive pressure on the yen".
SPANISH, ITALIAN YIELDS RISE
The euro fell 0.2 percent versus the dollar to $1.3074, within sight of a one-month low of $1.3033 hit on Monday. Stop-loss selling was reported around $1.3090 and market players cited more stops below $1.3065.
A break below $1.3033 would leave it on course to test a reported options barrier at $1.30, traders said.
Spanish and Italian yields spreads over German Bunds widened, weighing on the single currency, as the U.S. jobs numbers increased concerns about the impact a weaker U.S. economy may have on euro zone growth, especially in the region's weaker economies.
Spanish bonds have also come under particularly heavy pressure recently as investors fretted Spain could be the next source of contagion in the euro zone.
"The market is looking at Europe and saying there is a recession in some economies. Germany is doing quite well, but is being dragged down by the others," said Gavin Friend, currency analyst at National Australia Bank.
"Euro/dollar looks to be moving down through $1.30 and I think it will be in a new $1.29 to $1.3250 range."
The growth-correlated Australian dollar dipped 0.2 percent to US$1.0284. It struggled to pull away from a three-month low of US$1.0243 hit last week, weighed down by soft local data, lingering concerns about a hard landing for the Chinese economy - a key Australian export market - and expectations for a cut in domestic rates next month.
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