Nov 22 (Reuters) - Euro zone borrowing costs rose

slightly on Friday before purchasing managers' surveys (PMI) due

later in the session, as geopolitical tension prompted investors

to bid for safe-haven government bonds.

Russia fired a hypersonic intermediate-range ballistic

missile at the Ukrainian city of Dnipro on Thursday in response

to Britain and the United States allowing Kyiv to strike Russian

territory with advanced Western weapons, President Vladimir

Putin said.

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

euro area, was up 2 basis points (bps) at 2.33%.

Bond prices move inversely with yields.

Markets priced in a European Central Bank deposit facility

rate at around 1.95% by July.

Germany's 2-year yields, more sensitive to

expectations for the ECB policy rates, rose 2 bps to 2.11%.

The gap between French and German yields - a

gauge of the premium investors' demand to hold France's debt -

was at 78 bps after hitting 70.9 bps last week, its tightest

since Oct. 31.

French far-right leader Marine Le Pen threatened on

Wednesday to topple Prime Minister Michel Barnier's fragile

coalition government, slightly widening the French spread.

Italy's 10-year government bond yields, the

benchmark for the euro area periphery, rose 2 bps to 3.58%.

The spread between Italian and German yields

was at 125 bps after reaching 115.90 on Wednesday, its tightest

level since mid-March 2024. Investors expect a possible upgrade

by Moody's later on Friday.