Euro zone government bond yields edged slightly lower on Wednesday as markets were kept in check by caution about the new round of U.S. tariffs to be unveiled next week and their potential impact on economic growth.

The German 10-year bond yield, the benchmark for the euro zone bloc, edged down 0.9 basis points to 2.785%.

It hit a one-week high on Tuesday as hopes for narrower-than-feared U.S. tariffs drove investors to riskier assets.

The European Union's trade commissioner Maros Sefcovic met with U.S. President Donald Trump's top trade officials on Tuesday to try to avoid steep U.S. tariffs on EU goods next week.

Italy's 10-year yield was lower by 0.5 basis points at 3.892%, and the gap between Italian and German 10-year bond yields was 110 bps.

Markets also have an eye out for Britain's spring budget update later in the day, with British finance Minister Rachel Reeves likely to announce cuts to her spending plans in an attempt to show investors she can be trusted to fix the public finances as growth falters.

The gap between German and UK 10-year bond yields, the premium investors demand to hold UK government bonds, was at 196 bps.

(Reporting by Yadarisa Shabong in Bengaluru; Editing by Andrew Heavens)