April 2 (Reuters) - Euro zone borrowing costs rose on

Tuesday as investors balanced a jump in U.S. Treasury yields the

day before against German data confirming that the disinflation

process was underway.

U.S. Treasury yields rose on Monday as economic data raised

doubts about whether the Federal Reserve could deliver on three

rate cuts this year. The 10-year yield was last up 2

basis points after jumping 13.5 bps the day before.

Inflation fell in six economically important German states,

suggesting that national data will show a downward trajectory.

Money markets slightly raised their bets on future European

Central Bank rate cuts, pricing in 92 bps in 2024

from around 90 bps before the data.

Economists will pay close attention to national inflation

data later on Tuesday.

"Overall, we now expect euro-zone headline inflation to come

in around 2.3%, which is below the consensus forecast of 2.6%,"

said Franziska Palmas, senior Europe economist at Capital

Economics, who sees the core rate declining to 2.8%.

Germany's 10-year bond yield, the benchmark for

the bloc, rose 11 basis points to 2.397%, its highest level

since March 21.

Euro zone consumers lowered their near-term inflation

expectations in February but projections further out remained

unchanged, a new survey by the ECB showed.

"While the Fed is likely to seek further reassurance that

inflation is heading sustainably back to its 2% annual target

before embarking on rate cuts, our base case remains that easing

should start at the June policy meeting with 75 basis points of

cuts for the year," said Mark Haefele, chief investment officer

at UBS Global Wealth Management.

Germany's two-year yield, more sensitive to ECB

rate expectations, was last one bp higher at 2.83%.

Italy's 10-year bond yield rose 10.5 bps to 3.77%

, with the closely watched gap to Germany's 10-year

yield at 136 bps. It hit 142 bps earlier in the

session, its highest since March 4.

"Last week saw the potential of a perfect storm for euro

area government bonds with a further increase in Italy's tax

credits year-to-date on construction 'superbonus'," Citi

analysts said in a note to clients.

"This would make a downward trajectory for Italy's debt/GDP

ratio even more unlikely, adding to fiscal concerns already

emanating from France," it added.

The so-called Superbonus - a package of incentives for home

improvements - was originally expected to cost 35 billion euros

($37.9 billion) over 15 years. Still, the Treasury recently

acknowledged it had already forked out almost 150 billion euros

during the first four years alone.

Inflation data released on Friday showed that French

consumer prices rose by a smaller-than-expected 2.4%

year-on-year in March, while Italian EU-harmonised consumer

prices (HICP) came in below the median forecast of a Reuters

survey.