Nov 29 (Reuters) - Euro zone long-dated government bond

yields were on track for a fourth straight weekly fall on Friday

as data suggested a bleak economic outlook while a market gauge

of inflation expectations dropped below 2%.

The risk premium for holding French debt steadied as the

government said it was ready to make concessions over the next

budget amid growing concerns that opposition to the bill could

topple Prime Minister Michel Barnier's administration, which is

trying to curb an increasing public deficit.

Markets are waiting for inflation figures from France, Italy

and the wider euro zone area later in the session.

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

the bloc, was flat at 2.3% and down 12.5 basis points (bps) for

the week.

Data on Thursday showed that German annual inflation

remained flat in November against expectations of a second

consecutive increase.

Markets have priced in a European Central Bank deposit

facility rate of around 1.85% in July. They

are fully discounting a 25 bps rate cut at the ECB's December

meeting and have reduced the chance of a 50 bp move to around

20% from over 50% soon after PMI data was released last week.

Germany's 2-year government bond yield - more

sensitive to ECB policy rate expectations - fell 1 bp and was on

track to end the week almost flat.

The gap between French and German yields - a

gauge of the premium investors demand to hold France's debt -

was unchanged at 80.5 bps, after hitting 90 bps earlier this

week, its widest level since 2012.

Italy's 10-year government bond yield - the benchmark for

the euro zone periphery - fell 1 bp to 3.34% and was down 16.5

bps on the week.