TOKYO, March 30 (Reuters) - Benchmark Japanese

government bonds (JGBs) slumped on Monday, sending yields to a

near three-decade high, as the worsening Middle East conflict

stoked inflation concerns and expectations for an early central

bank interest rate hike.

The benchmark 10-year JGB yield rose 2 basis

points (bps) to 2.390%, a level not seen since February 1999.

The five-year yield rose 0.5 bps to 1.820%.

Yields move inversely to bond prices.

Japanese shares plunged and the yen traded above the key

160-per-dollar level as the month-long war in Iran weighed on

investor sentiment. In a summary of opinions from the Bank of

Japan's most recent policy meeting, one member said surging oil

prices and a weak yen could push up inflation sharply.

"Lingering uncertainty over the chances of an early

ceasefire is likely to weigh on the government bond market, as

concerns remain that higher crude oil prices could fuel upside

inflation risks," Kazuya Fujiwara, bond strategist at Mitsubishi

UFJ Morgan Stanley Securities, said in a note.

Japan remains highly exposed to spikes in crude oil prices

due to its heavy reliance on imported energy. Higher oil costs

tend to feed into domestic inflation, eroding the real value of

fixed-income securities and adding pressure on the central

bank to tighten monetary policy.