TOKYO, July 14 (Reuters) - Japanese government bonds (JGBs)

rallied on Tuesday after officials flagged possible changes to

asset allocations of pension funds and as demand increased at a

long-term debt sale.

Here are a few details:

* The benchmark 10-year JGB yield slid 4.5

basis points (bps) to 2.740%. Yields move inversely to bond

prices.

* Finance Minister Satsuki Katayama said the government may

consider adjusting asset allocation in Japan's massive pension

funds if the investment environment changes sharply.

* Health Minister Kenichiro Ueno told a separate press

conference that the ministry will examine reviewing the

Government Pension Investment Fund's (GPIF) asset allocation if

needed, but downplayed the prospect of any near-term changes.

* The Ministry of Finance sold about 700 billion yen ($4.31

billion) in 20-year bonds. The bid-to-cover ratio, a measure of

demand, rose to 4.52, the highest since the sale in April. The

tail, another measure of demand, was 0, the lowest since an

auction in 2010.

* "The outcome was strong, better than forecast," said

Takuya Onozawa, a fixed-income strategist at Mitsubishi UFJ

Morgan Stanley Securities. "The level of the yields is

relatively high, which is why there was strong demand."

* JGBs rallied sharply on Friday after Katayama suggested

that the GPIF and other retirement vehicles could be encouraged

to direct more investments into domestic assets.

* The 20-year yield eased 4.5 bps to 3.7%,

extending its declining streak to three sessions. The 30-year

yield dropped 4.5 bps to 3.860%.

* The two-year yield, the most sensitive to

Bank of Japan policy rates, decreased 1 bp to 1.435%, while the

five-year yield fell 3.5 bps to 1.960%.

($1 = 162.4100 yen)