JGBs surge as US housing woes snap rally in stocks

* JGBs jump on short-covering after 3-day slide

* CPI data highlights BOJ caution on policy outlook

* Ten-year yields seen in 1.5-1.8 pct range

By Eric Burroughs

TOKYO, July 25 (Reuters) - Japanese government bonds jumped on Friday, tracking an overnight surge in Treasuries after data showing U.S. existing home sales at a 10-year low brought an abrupt end to this week's rally in global stock markets.

A report in Japan showed core consumer prices accelerated to a decade-high annual rate of 1.9 percent in June, but the figures only reaffirmed that the pick-up in inflation was due almost entirely to energy and food prices. [ID:nT344938]

With rising prices sapping the spending power of consumers, Bank of Japan officials have said inflation conditions are different in Japan to other major economies and they are more concerned about the downside risks to growth.

BOJ board member Atsushi Mizuno, known as the most hawkish policymaker at the central bank, surprised investors the previous day by reiterating that cautious view. Mizuno's comments suggested any lift in interest rates is a long way off. [ID:nT13388]

Mizuno also said there was a chance Japan could slip into a shallow recession, the same day as data showed exports fell in June for the first time in five years and pointed to a possible contraction in the April-June quarter.