March 14 (Reuters) - U.S. Treasury yields rose on Friday

on concerns over the potentially inflationary impact of tariffs

as trade wars between the U.S. and its trading partners

escalate, while a stock market recovery reduced safe-haven

demand for U.S. government debt.

Market participants are grappling with uncertainty over how many

of President Donald Trump's tariffs are going to be implemented

as well as whether they will slow economic growth and lead to a

renewed surge in prices.

"What you've had over the past week or two is a repricing of

what's called the Trump put lower for equities, while at the

same time, understanding that tariffs are probably here to stay

in some form and aren't just a negotiating tactic," said Zachary

Griffiths, senior strategist at CreditSights.

Trump said on Thursday he was not going to change his mind on

imposing sweeping reciprocal tariffs on all trading partners on

April 2.

A report on Friday found that U.S. consumer sentiment plunged in

March and inflation expectations soared amid worries about

tariffs.

Data this week has pointed to improving inflation, though some

underlying components in the release of the consumer price and

producer price reports for February were higher than expected.

That data will feed into the calculation of the Personal

Consumption Expenditures Price Index, the Federal Reserve's

preferred inflation measure, which is due to be released on

March 28. The inflation data for February is also seen as

backward-looking, as it covers the period before tariffs were

put in place.

The Fed is expected to hold interest rates steady when it

concludes a two-day meeting next Wednesday, but investors will

focus on Fed policymakers updated economic and interest rate

projections for signs of whether they are becoming more

concerned about the economic outlook.

"It'll be interesting to see how the Fed re-marks its growth

expectations and how they expect that to flow through to not

only inflation, but what they ultimately do with the policy

rate," Griffiths said.

Fed funds futures traders see the U.S. central bank as most

likely to resume its rate cuts in June.

U.S. stocks rebounded on Friday, reducing safe-haven demand for

U.S. bonds. Demand for Treasuries increased earlier this week

amid sharp stock declines, which helped to keep 10-year yields

near four-month lows reached earlier this month.

Higher German government debt yields, as Germany's conservatives

and two other parties agreed to a debt deal to dramatically

boost spending, meanwhile, helped to pull U.S. yields higher on

Friday.

The yield on benchmark U.S. 10-year notes was

last up 2.8 basis points on the day at 4.304%. The 2-year note

yield rose 3.5 basis points to 3.988%.

The yield curve between two-year and 10-year notes

was last at 31.5 basis points.

Traders are also watching discussions over a possible

Russia-Ukraine peace deal.

The Kremlin said on Friday that Russian President Vladimir Putin

had sent Trump a message about his proposal for a ceasefire in

Ukraine via the U.S. president's special envoy and that there

were grounds for "cautious optimism."

The U.S. Senate on Friday was poised to pass a stopgap spending

bill and avert a partial government shutdown, removing one

short-term risk that was contributing to investor anxiety.