TOKYO, July 26 (Reuters) - Japan's Nikkei share average inched lower on Wednesday, led by auto stocks, as investors locked in profits ahead of the Bank of Japan's two-day policy meeting starting on Thursday.

By 0141 GMT, the Nikkei index was down 0.2% at 32,616.52. The broader Topix had slipped 0.2% to 2,280.29.

"There were no negative cues to sell stocks. Investors were just cautious ahead of the central bank decision," said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.

"We are also in the middle of the corporate earnings season, which prompted investors to hold off their active bets."

The BOJ is leaning towards keeping its yield control policy unchanged as policymakers prefer to scrutinise more data to ensure wages and inflation keep rising.

Market participants were not fully convinced that the BOJ would maintain its current policy, as they remember a surprise tweak in the yield curve control policy in December when it widened the trading band of the benchmark 10-year bond yield.

On Tuesday, the International Monetary Fund's chief economist, Pierre-Olivier Gourinchas, said the BOJ should start preparing for future monetary tightening by moving away from its yield control policy.

Uniqlo brand-owner Fast Retailing declined 0.5%, dragging down the Nikkei the most. Chip-testing equipment maker Advantest slipped 0.8% and air-conditioning maker Daikin Industries fell 0.95%.

Automakers fell 1.33% to become the worst performer among the Tokyo Stock Exchange's 33 industry sub-indexes. Mitsubishi Motor lost 2.33% and Mazda Motor slipped 2.34%.

Bucking the trend, chip-making equipment maker Tokyo Electron rose 0.61%, while technology investor SoftBank Group gained 0.65%.

Otsuka Holdings advanced 2% to become one of the biggest support for the Nikkei, after the Pocari Sweat health drink maker raised its forecast for the six months ended June. (Reporting by Junko Fujita; Editing by Subhranshu Sahu)