By Yoruk Bahceli

AMSTERDAM (Reuters) – Euro zone bond yields were a touch higher on Wednesday, with the market’s focus mostly on a benchmark bond auction and inflation reading out of the United States, a day ahead of the single-currency bloc’s central bank meeting.

The bloc’s government bonds have calmed in recent sessions, after the German 10-year yield, its benchmark, saw its worst performance in years alongside many other government bonds in February, pulled up by rising U.S. Treasury yields on bets that a vast stimulus package would reawaken inflation.

Though the rise in European yields is seen as less justified given a weaker economic outlook, euro area yields closely track moves in the United States, so attention remains on market moves and data there that might break the calm.

On Wednesday, yields on both sides of the Atlantic were unchanged to slightly higher, with Germany’s 10-year yield up about a basis point to -0.30% at 0822 GMT, moving in tandem with the 10-year Treasury yield.

Yields on 10-year Italian government bonds were unchanged at 0.70%, keeping the closely watched gap between them and 10-year German yields below 100 bps after it moved towards 110 bps during the recent sell-off.

Euro area government bonds held a dovish tone ahead of Thursday’s European Central Bank policy meeting, where focus will be on the bank’s messaging after it failed to raise its emergency bond purchases during the recent sell-off.

On Wednesday, focus was on the U.S. February inflation reading due at 1330 GMT given the recent bond sell-off. A Reuters poll expects inflation to rise to 1.7% year-on-year from 1.4% in January, though a core reading that excludes food and energy is expected to stay unchanged at 1.4%.

“Today’s macro focus should be on U.S. CPI in the afternoon, which should soothe inflation concerns with core inflation not yet picking up and our economists looking for a below-consensus reading,” said Michael Leister, head of interest rates strategy at Commerzbank.

But Mizuho analysts said that a significant upside inflation surprise would be hard for the market to ignore.

The inflation reading comes as the U.S. Treasury holds a 10-year bond auction, after a three-year sale was well received on Tuesday, in contrast to recent sales that saw poor appetite.

In the euro area primary market, Germany will reopen a five-year bond via auction to raise 4 billion euros ($4.75 billion), while Portugal will reopen six and nine-year bonds to raise up to 1.25 billion euros.

(Reporting by Yoruk Bahceli; Editing by Pravin Char)