TOKYO, Aug 14 (Reuters) - Japanese government bonds rose on

Friday, sending shorter-term yields down from historic highs,

tracking a rally in U.S. Treasuries, even as expectations firmed

around a Bank of Japan rate hike next month.

Here are a few details:

* The benchmark 10-year JGB yield fell 1.5

basis points to 2.855%, trimming a weekly gain. Yields move

inversely to bond prices.

* U.S. Treasury yields fell across the curve on Thursday

after tame producer price data cooled expectations for a Federal

Reserve rate hike next month.

* "Following the decline in U.S. Treasury yields and the

drop in crude oil prices, conditions appear favourable for

buying domestic bonds," Takayuki Miyajima, senior economist at

Sony Financial Group, said in a note. "On the other hand,

speculation about an early interest rate hike by the Bank of

Japan continues to weigh on the market."

* Data on Thursday showed Japan's July producer price index

rose 7.2% year-on-year, slightly below forecasts but still

elevated enough to reinforce expectations for a rate hike.

* Japan may signal the chance of faster-than-expected

interest rate increases to stem the yen's decline, Tokyo's

former top currency diplomat Mitsuhiro Furusawa told Reuters.

* The two-year yield, the one most sensitive

to BOJ policy rates, slid 0.5 bp to 1.64%, down from a 31-year

high reached on Thursday.

* The five-year JGB yield was flat at 2.12%

after reaching a record 2.125% in the previous session.