LONDON, Mar 30 (Reuters) - Euro zone bond yields were

broadly steady on Monday, remaining near multi-year highs, as

investors mulled the risks of the Iran war for inflation and

economic growth.

The Israeli military said Iran launched multiple waves of

missiles at Israel and that the Air Force was carrying out

strikes on Tehran on Monday.

The latest attacks came a day after President Donald Trump

said the U.S. and Iran had been meeting "directly and

indirectly" and that Iran's new leaders have been "very

reasonable", even as more U.S troops arrived in the region.

German 10-year bund yields, the benchmark for

the euro zone, were last steady at 3.0977%. They hit 3.13% on

Friday, their highest level since May 2011 and were last on

track to end March around 44 bps higher.

Yields on Italian 10-year bonds were last 1.8

bps lower at 4.0506%, having risen to their highest since

mid-2024 on Friday.

Global government bonds have been under pressure since the

early days of the conflict as higher oil prices have driven up

inflation expectations and raised bets on higher central bank

interest rates.

Markets this week will get some insights into how the

conflict in the Middle East has been impacting the economy, with

flash euro zone inflation due Tuesday.

After long hovering around the 2% target and coming in at

1.9% in February, a Reuters poll of economists is expecting

inflation to have jumped to 2.7% in March, which would be its

highest level in over two years.

Money markets were last pricing in around three rate hikes.

Before the Iran conflict erupted, the balance was towards a cut

from the ECB this year.

ECB board member Isabel Schnabel on Friday said there was no

need for the central bank to rush into action.

German two-year bund yields were last little

changed at 2.6803%, while the Italian two-year bond yields

last dipped 2.3 bps to 2.9787%.

They were last set to rise around 67 bps and 84 bps,

respectively, in March as shorter-dated bonds have been hit

especially hard.

(Reporting by Sophie Kiderlin; Editing by Arun Koyyur)