TOKYO, June 10 (Reuters) - Japanese government bond (JGB)

yields rose on Wednesday as signs of inflationary pressures cast

a cloud over a long-term debt sale.

Here are a few details:

* The benchmark 10-year JGB yield rose 3

basis points (bps) to 2.695%. Yields move inversely to bond

prices.

* Data on Wednesday showed Japan's producer price index

(CGPI) rose 6.3% year-on-year in May, exceeding forecasts and

underscoring the impact of higher energy costs linked to the

Middle East conflict. Inflation erodes the value of fixed

payments from debt.

* Ministry of Finance sold about 600 billion yen ($3.74

billion) of 30-year JGBs. The auction's bid-to-cover ration, a

measure of demand, declined to 2.94, the lowest in a year.

* Investors are cautiously positioning ahead of Bank of

Japan policy meeting next week, where expectations for a rate

hike have firmed amid signs of persistent inflationary

pressures.

* The central bank will raise its key interest rate this

month and again in the fourth quarter, taking borrowing costs to

1.25% by year-end, a Reuters poll of economists showed.

* "Curbing yen weakness and excessive rises in long-term

interest rates are a priorities for both the BOJ and the

government," Ataru Okumura, a senior rate strategist at SMBC

Nikko Securities, said in a note. "Therefore, attention in the

JGB market is expected to focus on how strongly the BOJ signals

its intent to raise rates in the future."

* JGBs rallied on Tuesday following a report that the BOJ

will consider maintaining the current pace of bond purchases

beyond next fiscal year, pausing its tapering plan.

* The 20-year JGB yield climbed 0.5 bps to

3.565%. The 30-year yield was flat at 3.865%.

* The two-year yield, the one most sensitive

to BOJ policy rates, increased 0.5 bps to 1.42%. The five-year

yield rose 1.5 bps to 1.94%.

($1 = 160.3900 yen)