Euro zone bond yields set for weekly fall on tariff and growth concerns
Investors were also watching Germany's Bundesrat upper house of parliament, which is set to vote on Friday on a dramatic increase in spending. Analysts said the bill is likely to pass that final hurdle.
Germany's 10-year bond yield, the benchmark for the euro zone bloc, fell 2 basis points (bps) to 2.761% and was on track to fall 11 bps for the week. Yields move inversely to prices.
Analysts at Barclays, Commerzbank and ING said concerns about U.S. President Donald Trump's April 2 deadline for tariff decisions was weighing on sentiment and pushing investors towards the safety of government bonds.
German yields nonetheless remain 39 bps higher for the month after the announcement of the country's new spending plans - to be funded largely through bond markets - sent yields soaring.
Italy's 10-year yield was lower by 1 bp at 3.836%, and the closely watched gap between Italian and German bond yields widened slightly to 107 bps.
Germany's two-year bond yield, which is more sensitive to European Central Bank rate expectations, was 1 bp lower at 2.158%.
(Reporting by Harry Robertson; Editing by Hugh Lawson)
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