June 24 (Reuters) - Euro zone government bond yields

slightly extended their fall after the Ifo German business

survey showed that business morale unexpectedly fell in June.

The Ifo institute said its business climate index sank to

88.6 in June from 89.3 in May, compared with a reading of 89.7

forecast by analysts in a Reuters poll.

German 10-year bond yield, the benchmark for the

euro area, dropped 2 basis points (bps) to 2.39%. It was down

one bp right before the data release.

The bloc's borrowing costs fell last week after weak PMI

data and dovish signals from the Swiss and British central

banks.