Euro zone yields fall from multi-year highs as oil falls on Iran sanctions

Euro zone government bond yields fell from close to multi-year highs on Tuesday as oil prices declined, with traders viewing the latest U.S. sanctions against Iran as preferable to further military escalation.

Germany's 10-year bond yield DE10YT=RR, the benchmark for the bloc, fell 2.9 basis points to 3.2171%, down from the 15-year high of 3.275% touched last week. Yields move inversely to prices.

Yields, particularly those on longer-dated bonds, hit their highest in at least a decade around the world last week as investors worried about inflation stemming from the U.S.-Israeli war with Iran and high levels of government spending.

The German 30-year yield DE30YT=RR fell 1.9 bps on Tuesday to 3.729%, after touching a 15-year high last week of 3.787%.