* Curve steepens as investors unwind flatteners
* 10-yr futures slip for third straight session
By Lisa Twaronite
TOKYO, Nov 21 (Reuters) - Japanese government bonds slipped slightly on Wednesday, as a weakening yen helped bolster Japanese shares and took away some of the appeal of fixed-income assets.
Losses were limited, however, after Greece’s international lenders failed to agree how to get its debt down to a sustainable level to receive a bailout.
Euro zone finance ministers will meet again on Monday, after their meeting in Brussels ended on Wednesday without a plan.
“The stock market was really strong on anticipation of a Greece agreement today,” said Tadashi Matsukawa, head of Japan fixed income at Pinebridge Investments in Tokyo.
“In the JGB market, we are seeing some unwinding of the flattening trade today, after the 20’s and the 30’s have been performing for the past couple of days, and that trade seems to be taken off,” he said.
The 10-year JGB futures contract ended down 0.05 point at 144.56, its third session of losses as it moved away from a nine-year high of 144.73 hit on Friday.
Yields on 10-year notes rose in cash trading, adding 1 basis point to 0.735 percent.
JGBs also have been pressured by political concerns heading into an election on Dec. 16, at which the ruling party is expected to lose support to the main opposition Liberal Democratic Party.
The LDP said on Wednesday that on its return to power it would set a 2 percent inflation target with an eye to revising the law governing the Bank of Japan so as to boost cooperation between the government and the central bank.
“We aren’t going to see much movement in JGBs until the election, and then we’re getting into the year-end,” said a fixed-income fund manager at a European asset management firm.
“There was a sell-off on the political fears and then some dip-buying, but yields remain in recent ranges,” he said.
Japan’s benchmark yields are holding above their nine-year low of 0.720 percent hit in July, but hit their high of 0.785 percent for the month so far on Nov. 1. They last traded above 0.800 percent in late September
On Tuesday, the Bank of Japan held off from additional monetary easing, in line with expectations.
The yen’s fall to seven-month lows against the dollar on Wednesday heightened expectations Japan’s central bank will be pushed into implementing more radical monetary easing.
The weaker yen and stimulus expectations helped lift the Nikkei share average to a two-month high.
Trade data on Wednesday showed Japan’s exports fell in annual terms for a fifth month in October, a further sign the economy has slipped into recession.
The yield curve steepened late in the session as the superlong sector edged lower, with yields on 20-year debt and those on 30-year bonds both adding 1.5 basis points to 1.680 percent and 1.945 percent respectively.