LONDON, Dec 23 (Reuters) - Euro zone bond yields ticked

up to their highest level in around a month on Monday as

investors continued to try to gauge the outlook for central bank

rate cuts in 2025.

The Federal Reserve last week put upward pressure on U.S.

government bond yields, which set the tone for other markets

around the world, when policymakers said they now expect to cut

rates twice in 2025, down from a previous estimate of four cuts.

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

the euro zone, rose 3 basis points (bps) to 2.32% on Monday,

around the highest level since Nov. 22. Yields move inversely to

prices.

Trading volumes were lower due to traders being off over the

holiday season, potentially accentuating price moves.

Italy's 10-year yield was higher by 5 bps at

3.50%, and the gap between Italian and German

widened 1.7 bps to 118 bps.

Germany's two-year bond yield, which is more

sensitive to European Central Bank rate expectations, rose 1.7

bps to 2.056%.