LONDON, Aug 20 (Reuters) - Euro zone bond yields inched

lower on Tuesday, maintaining the calm that has washed over bond

markets following volatility earlier this month, with investors

eyeing a meeting of central bankers in Jackson Hole later this

week.

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

the euro zone, was a fraction lower at 2.25%, having been

largely steady for the past few sessions.

This week's annual gathering of central bankers was seen by

investors as the biggest potential risk factor on the horizon.

Federal Reserve chair Jerome Powell is due to deliver

remarks on the economic outlook on Friday, the symposium's first

full day, with other top global policy makers also due to speak.

Italy's 10-year yield was lower by 1.2 basis

points​ (bps) at 3.62%, and the gap between Italian and German

10-year yields was 136 bps, continuing to narrow

from more than 150 bps in early August.

Germany's two-year bond yield, which is more

sensitive to European Central Bank rate expectations, was 1 bp

lower at 2.44%.