TOKYO, Aug 7 (Reuters) - A swath of Japanese regions, including central areas, are bracing for Typhoon Khanun to approach near southwestern Japan on Tuesday, as the country's meteorological agency warns of damage from strong winds and heavy rainfall.

The storm was hovering about 160 kilometres (99 miles) east-northeast of the city of Amami in southwestern Japan and moving slowly north as of 9 a.m. local time (0000 GMT), the Japan Meteorological Agency (JMA) said.

After skirting western parts of Japan's Nagasaki prefecture, Khanun is projected to make its way parallel to the coast north toward South Korea, according to the JMA.

Khanun has gradually lost its strength but still packs winds of 108 kph (67 mph), with gusts of up to 144 kph.

Rainfall of 300-400 mm (12-16 inches) was expected between Tuesday and Wednesday in the Shikoku and southern Kyushu regions, with 200-300 mm of rain in Amami, as well as Kinki in Western Japan and the central region of Tokai, the weather agency said.

"Due to the slow movement of the typhoon and its prolonged impact, total rainfall may greatly exceed the normal monthly rainfall for August in the Pacific Ocean side of Kyushu and western Japan, and in the Tokai region," the JMA said.

Mazda Motor Corp (7261.T) will suspend production at its two domestic plants on Wednesday and Thursday, the carmaker said on Monday.

Shinkansen, or high-speed train, service may also be suspended between the Hakata and Osaka stations from Wednesday night until Thursday morning, the West Japan Railway Co (9021.T) said.

The city of Nagasaki relocated a venue to commemorate the 78th anniversary of the U.S. atomic bombing on Wednesday to an indoor convention centre from a park.