CORRECTED-Yields on Japan's shorter-end bonds rise after BOJ comments drive rate hike bets

TOKYO, March 13 (Reuters) - Yields on Japan's shorter-dated government bonds reversed course to rise on Thursday as comments from the Bank of Japan chief boosted bets for an early interest rate hike.

The 10-year JGB yield JP10YTN=JBTC rose 1 basis point to 1.53%, after falling to as low as 1.495% earlier in the session.

BOJ Governor Kazuo Ueda said on Thursday he expects consumption to improve, as the rise in import costs moderates and wage growth strengthens.

"Some investors thought Ueda's comments indicated signs for the early rate hike and they sold JGBs, " said Katsutoshi Inadome, senior strategist at Sumitomo Mitsui Trust Asset Management.

The BOJ is set to keep rates steady at next week's policy meeting, though the board may discuss a hike as soon as May with an eye on domestic inflation and market volatility induced by uncertainty on U.S. trade policy, sources have told Reuters.

Wages are seen as key for the BOJ's policy path. Many of Japan's biggest companies have met union demands for substantial wage hikes for a third consecutive year, seeking to help workers cope with inflation and retain staff amid labour shortages.

The two-year JGB yield JP2YTN=JBTC reversed course to rise 1 bp to 0.855%. The five-year yield JP5YTN=JBTC rose 2 bps to 1.15%, after falling to 1.115%.

Inadome said the BOJ will most likely raise its policy rate at its July meeting. Swap rates indicate a 79% chance of the BOJ raising the rate by 25 basis points to 0.75% at its meeting in July.

Yields on super-long dated bonds fell, with the 20-year JGB yield JP20YTN=JBTC slipping 1 bp to 2.245% and the 30-year JGB yield JP30YTN=JBTC fell 2 bps to 2.565%.

The 40-year JGB yield JP40YTN=JBTC was flat at 2.895%.