TOKYO, March 15 (Reuters) - Japan's government bond

(JGB) yields stayed close to 3-month highs hit earlier on

Friday, while the yen barely reacted after the country's largest

trade union group Rengo ( RNGOF ) announced a hefty 5.28% wage increase,

far higher than market expectations.

The announcement of the wage deal from Rengo ( RNGOF ), which

represents about 7 million workers at some large companies,

heightens expectations the Bank of Japan (BOJ) will end its

decade-long stimulus programme at its next policy meeting on

March 18-19.

Analysts had previously estimated increases at around 3.9%

this year, after last year's 3.6% rise, itself a three-decade

high.

The BOJ will debate ending its negative interest rate policy

next week if Friday's preliminary survey yielded strong results,

sources have told Reuters. Meanwhile, Jiji Press reported the

BOJ was making final arrangements to end negative rates next

week.

The benchmark 10-year bond yield was quoted

at 0.785% after the announcement, and had earlier hit 0.795%,

its highest since December.

The yen, which had risen to a five-week high

against the dollar last week, was last quoted at 148.42 per

dollar.

Futures contracts on the Nikkei Share Average

maturing in mid-June were up 0.47% at 38,470. The stock

market closed down 0.26% on Friday and is up more than 15% this

year.

The market has already priced in the end of the negative

rates policy, sending the yield on one-year Japanese treasury

bills to a near-decade high.