TOKYO, Sept 16 (Reuters) - Japan's government bond yield

curve steepened on Tuesday, as investors awaited a 20-year bond

auction in the next session.

The 20-year JGB yield rose 3 basis points

(bps) to 2.67% and the 30-year JGB yield jumped 4

bps to 3.25%.

Yields on super-long bonds are hovering at record high

levels on mounting concerns over the government's debt levels

and deficit spending.

"There are lots of market-moving cues after the auction so

we cannot expect active buying," said Naoya Hasegawa, chief bond

strategist at Okasan Securities.

Investors are weighing political uncertainties, Hasegawa

said, as the race to be the new leader of Japan's ruling Liberal

Democratic Party has just started, replacing outgoing leader

Shigeru Ishiba, who is also still the current prime minister.

The process to pick Japan's next leader is more

complicated than before as the LDP, which has ruled Japan for

most of the post-war period, and its junior coalition partner

lost their majorities in both houses of parliament during his

tenure.

The party will elect a new leader on October 4.

The market also awaits this week's meeting of the U.S.

Federal Reserve, which is expected to resume its easing cycle

and potentially leave the door open to further rate cuts.

The Bank of Japan will conclude its two-day meeting on

Friday, and investors are eyeing any hints about the next

interest rate hike.

"If the BOJ stresses the impact of the U.S. tariffs on the

economy, that means it will take time for the BOJ to raise

interest rates," Haseagawa said.

The 10-year JGB yield rose 1 basis point to

1.605%.

The two-year JGB yield rose by half a basis

point to 0.87%. The five-year yield rose 1.5 bps

to 1.155%.