LONDON, April 29 (Reuters) - Euro zone bond yields

traded around multi-week highs on Wednesday as efforts to end

the Iran war appeared to be in a stalemate and oil prices nudged

higher again, prompting persistent inflation worries.

German 10-year bond yields, the benchmark for

the euro zone, were last 1.6 basis points higher at 3.0775%.

They hit a two-week high of 3.0860% in the previous session.

The rate-sensitive German 2-year bond yield

meanwhile climbed 4.3 bps higher to 2.6819%, its highest since

April 7.

Bonds have come under renewed pressure in recent sessions,

with yields steadily ticking higher, as efforts to end the war

in the Middle East seem to be at an impasse. U.S. President

Donald Trump was unhappy with the latest proposal from Tehran,

which he said had informed the U.S. it was in a "state of

collapse" and figuring out its leadership situation.

Meanwhile, oil prices have been grinding higher as the

crucial Strait of Hormuz remains effectively shut down. Brent

crude futures for June rose for the eighth day in a row

on Wednesday and were last up over 1% at $113.25 a barrel.

Higher energy prices have fed into inflation fears, which

were underscored Tuesday by an ECB survey which showed inflation

expectations for one year ahead had jumped to 4.0% in March from

2.5% a month earlier.

Preliminary inflation data for April due this week from

across the euro zone will provide insights into the economic

impact of the war so far. In March, euro zone inflation jumped

to 2.6%, and according to a Reuters poll of economists, the

figure will likely have increased again in April.

The euro zone-wide data will be published not long before

the European Central Bank's latest interest rate decision on

Thursday. Preliminary data out of Germany is meanwhile due

Wednesday.

While the ECB is broadly expected to leave interest rates

unchanged this month, money markets were last pricing in roughly

three rate hikes from the central bank by the end of the year.

Investors will also be watching closely for any comments from

policymakers about the impact of the Iran war on the economy and

monetary policy.