JGB yields at 3-month highs, yen unmoved after Japan's big union wage deal

TOKYO, March 15 (Reuters) - Japan's government bond (JGB) yields stayed close to 3-month highs hit earlier on Friday, while the yen barely reacted after the country's largest trade union group Rengo announced a hefty 5.28% wage increase, far higher than market expectations.

The announcement of the wage deal from Rengo, which represents about 7 million workers at some large companies, heightens expectations the Bank of Japan (BOJ) will end its decade-long stimulus programme at its next policy meeting on March 18-19.

Analysts had previously estimated increases at around 3.9% this year, after last year's 3.6% rise, itself a three-decade high.

The BOJ will debate ending its negative interest rate policy next week if Friday's preliminary survey yielded strong results, sources have told Reuters. Meanwhile, Jiji Press reported the BOJ was making final arrangements to end negative rates next week.

The benchmark 10-year bond yield was quoted at 0.785% after the announcement, and had earlier hit 0.795%, its highest since December.

The yen, which had risen to a five-week high against the dollar last week, was last quoted at 148.42 per dollar.

Futures contracts on the Nikkei Share Average maturing in mid-June were up 0.47% at 38,470. The stock market closed down 0.26% on Friday and is up more than 15% this year.

The market has already priced in the end of the negative rates policy, sending the yield on one-year Japanese treasury bills to a near-decade high.

(Reporting by Kevin Buckland and Junko Fujita Editing by Vidya Ranganathan and Mrigank Dhaniwala)