TOKYO, June 19 (Reuters) - Japanese government bond yields declined on Wednesday, reversing an earlier rise, following a Reuters report hinting at less longer-term debt issuance in the future.

A draft proposal by a finance ministry panel, seen by Reuters, recommends issuing shorter-duration debt and introducing floating-rate notes while trimming issuance of the longest-tenor bonds.

The proposal will be among the factors the government will consider while compiling its debt issuance plan for the next fiscal year beginning in April 2025.

The 20-year JGB yield fell 2 basis points (bps) to 1.765% as of 0620 GMT, after rising as much as 2 bps earlier in the day.

The 30-year yield sank 2.5 bps to 2.12%, reversing a 2.5 bps advance.

The 10-year JGB yield fell 1 bp to 0.930%, from a 0.5 bp gain earlier in the session.

The five-year yield fell 0.5 bp to 0.505%, flipping from a 0.5 bp gain.

The two-year JGB yield was flat at 0.28%.

The Reuters report triggered the reversal, said Naomi Muguruma, senior market economist at Mitsubishi UFJ Morgan Stanley Securities.

At the same time, lack of clarity at this point over the next issuance plan, as well as uncertainty about the path for Bank of Japan policy mean that for now, "the overall market direction is difficult to determine", Muguruma added.

BOJ Governor Kazuo Ueda told parliament on Tuesday that an interest rate rise next month was "certainly possible", depending on incoming economic data.

Expectations had risen that the central bank would forgo a hike in July after announcing last week that it would outline a reduction of its bond purchase programme at the meeting, on the assumption that doing both at the same risked upending markets.

"The market is being spun in circles by what the BOJ is doing," said Shoki Omori, chief Japan desk strategist at Mizuho Securities. (Reporting by Kevin Buckland; Editing by Mrigank Dhaniwala and Sohini Goswami)