LONDON, March 31 (Reuters) - Euro zone government bond

yields were little changed on Tuesday after falling the previous

day, as traders weighed the chances of an end to the Iran war

and awaited data expected to show a sharp rise in inflation in

March due to higher energy costs.

Yields had retreated from multi-year highs on Monday after

rising sharply this month because of the conflict, with

investors appearing to refocus on the risk of weaker growth

stemming from the energy shock.

Germany's 10-year yield, the euro zone

benchmark, was last down 1 basis point at 3.031%. Yields move

inversely to prices.

The yield fell 6 bps on Monday after hitting its highest

since 2011 on Friday at 3.13%. It was still on track on Tuesday

to rise 39 bps in March, the biggest monthly increase since late

2022.

Investors continued to assess developments in the month-old

war, with oil prices holding above $110 a barrel after Iran

attacked and set ablaze a fully loaded crude oil tanker off

Dubai.

The Wall Street Journal reported that U.S. President Donald

Trump had told aides he was willing to end the military campaign

even if the key Strait of Hormuz remains largely closed. The

report boosted equities, but bonds showed little reaction.

Euro zone inflation data due at 1100 CET (0900 GMT) is

expected to show a jump to 2.6% in March from 1.9% in February

as energy prices surged.

Germany's two-year yield, which is sensitive to

European Central Bank interest rate expectations, was last flat

at 2.623%.

The yield has risen 61 bps in March as traders have bet the

ECB will need to hike rates to tame inflation, putting it on

track for its biggest monthly rise since mid-2022.