Sept 4 (Reuters) - Euro zone government bond yields fell

on Thursday after weak U.S. data and dovish remarks from Federal

Reserve officials.

However, investors remained concerned about rising public

debt and increased bond supply in the euro area, with France's

government facing a likely collapse next week over a contested

budget vote, while Germany is ramping up fiscal spending.

Fed officials continued to animate their belief that rate

cuts lie ahead, while job openings fell in July, reflecting a

softening labour market.

Markets await further U.S. jobs data and the latest reading

from the ISM Services PMI later in the session.

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

the euro zone bloc, dropped 3.5 basis points (bps) to 2.71%.

U.S. Treasury yields edged down in London trade on Thursday

after falling sharply the day before.

Ultra long-dated euro zone government bonds came under

selling pressure earlier this week, with yields hitting

multi-year highs, as investors grew increasingly concerned about

rising debt levels across the bloc.

Markets expect Germany's investment plans, along with likely

increases in defence spending across euro area countries, to

push up debt.

Yields on 30-year German bonds was down 4 bps at

3.32%. They hit 3.434% on Wednesday, their highest levels in

over 14 years.

"Euro area government bonds are probably not out of the

woods as the underlying fiscal challenges and funding

implications still loom large," said Hauke Siemssen, rate

strategist at Commerzbank.

France's 30-year yield was down 5 bps at 4.40%.

It hit 4.523% on Tuesday, its highest since June 2009.

The yield gap between 10-year French government bonds

and safe-haven German Bunds - a market gauge of

the risk premium investors demand to hold French debt - widened

to 79 bps after reaching 82 bps last week.

French Finance Minister Eric Lombard said the government

would have to compromise on plans to cut the budget deficit if

Prime Minister Francois Bayrou is toppled in a confidence vote

on September 8, the Financial Times reported on Wednesday.

Analysts also noted that, despite expectations for a higher

risk premium on ultra-long borrowing costs, demand for

longer-dated bonds remained quite robust.

Italy's Treasury said on Tuesday it raised 5 billion euros

through a new 30-year BTP, after attracting around 107 billion

euros in total orders.

Spain's 30-year yields fell 5 bps to 4.19% after

reaching 4.31% on Tuesday, their highest since November 2023.

Italy's 10-year yield was 4.5 bps lower at

3.59%, and the gap between Italian and German bunds

tightened one bp to 88 bps.

Italy's 30-year yields fell 6 bps to 4.62%.