* Greek aid tranche delayed again, Eurogroup meets Monday
* Lack of Greek solution seen supporting German debt auction
* Germany to sell 4 billion euros of 10-year debt
By Marius Zaharia
Nov 21 (Reuters) - Safe-haven German Bunds rose on Wednesday after Greece's international lenders failed to reach an agreement to release an aid tranche to Athens, boding well for a debt auction later in the day.
Euro zone finance ministers, the International Monetary Fund and the European Central Bank will meet again on Monday to try to pencil a deal on how to get the Greece's debt down to a sustainable level.
The main sticking point is whether to push back the target date for the debt to fall to 120 percent of output to 2022 from 2020. The latter cannot be achieved without euro zone members taking a loss on what Greece owes them but Germany and others oppose such a step.
The lack of consensus leaves the market no choice but to price in the possibility that Greece may receive no further help and face an uncontrolled default that may see it pitched out of the currency union.
Eurogroup Chairman Jean-Claude Juncker said the delay was caused by "technical reasons" and other officials said a deal was close, preventing investors from panicking.
"They seem to be making the right noises ... but it's a bit disappointing that they failed," one trader said.
Bund futures were 13 ticks higher on the day at 142.51, having fallen by 62 ticks on Tuesday on expectations a deal would be reached.
Cash 10-year Bund yields were 1.2 basis point lower at 1.404 percent, in the middle of a roughly 50 bps trading rage that has held for the past six months.
Greek and other peripheral country debt showed little reaction, reflecting expectations a deal would eventually be done.
However, the appeal of low-risk bonds looked set to ease an auction of up to 4 billion euros of 10-year German debt.
"I would assume there are a couple of investors around that still think the sovereign debt crisis is here to stay. They want this triple-A Bund and nothing else," said Marius Daheim, chief strategist at Bayerische Landesbank.
Commerzbank strategists called the failure to reach a deal on Greece an "unhoped-for support for German supply" and said investors should buy Bunds, having earlier recommended they sell.
Societe Generale strategists said investors may also be attracted by relative value in German 10-year bonds, which have underperformed the five-year sector in the past month.
The bond was, however, sold at an average yield of 1.56 percent at the last auction a month ago, and the fall in yields since then might put off some investors.