TOKYO, March 12 (Reuters) - Japanese government bond

(JGB) yields edged higher on Wednesday as a rise in U.S.

Treasury yields overnight took the spotlight.

The 10-year JGB yield rose 1.5 basis points

(bps) to 1.52%, following a rise in U.S. Treasury yields after

news that Ukraine would accept a U.S. proposal for a ceasefire

with Russia.

Benchmark 10-year JGB futures fell 0.42 points to

138.4 yen.

Market reaction was relatively muted to news that many of

Japan's biggest companies have met union demands for substantial

wage hikes, after the nation's largest labour union umbrella

group said last week its unions were seeking an average hike of

6.09%.

Much of the focus on this year's "shunto" talks is whether

there will also be strong pay gains at small and medium-sized

firms.

Spring wage negotiations "tend to have a very predictable

path...so I don't think it's going to be a major driver," said

Shinichiro Kadota, head of Japan FX and rates strategy at

Barclays, ahead of the news.

Given investors have already factored in further interest

rate hikes by the Bank of Japan (BOJ), JGB yields seemed to be

moving more in line with global yields, while liquidity issues

in the market could persist until the end of March when the

fiscal year comes to a close, he added.

BOJ Governor Kazuo Ueda on Wednesday said recent rises in

bond yields were a natural reflection of market expectations of

future interest rate hikes, underscoring the BOJ's resolve to

keep raising short-term interest rates.

The 20-year JGB yield fell 1.5 bps to 2.255%.

The bid-to-cover at the auction for the corresponding bond was

3.46, up from 3.06 in February.

The 30-year JGB yield was last up 0.5 bp at

2.585%, after touching its highest since July 2006 at 2.615%

earlier in the day.

The two-year JGB yield rose 1.5 bps to0.845%,

while the five-year yield climbed 2.5 bps to1.13%.