April 4 (Reuters) - Euro zone government bond yields

headed for their largest weekly drop since last November on

Friday as investors sought safe havens after far-reaching U.S.

tariffs darkened the outlook for the global economy and deepened

fears of a recession.

Countries around the world threatened retaliation after U.S.

President Donald Trump's tariffs fed expectations for a global

downturn and for sharp price hikes in the world's biggest

consumer market.

That caused a sell-off in stocks as investors sought the

relative safety of government bonds and other assets such as

gold.

The German 10-year bond yield, the benchmark for

the euro zone bloc, fell 4.4 basis points to 2.597%. Yields were

set for a weekly decline of 15 bps, the most since November last

year.

Italy's 10-year yield was lower by 3 basis

points at 3.739%, and the gap between Italian and German 10-year

bond yields widened to 114 bps.

The French 10-year yield fell 2.2 bps to 3.346%.

All three 10-year yields continued their slide from Thursday

and were at their lowest since early March, before Germany

announced its massive spending and fiscal plans that drove euro

zone bond yields higher.

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

sensitive to ECB rate expectations, was down 2.8 bps at 1.903%.

It was at its lowest since December.

Markets are pricing in a roughly 70% chance of a 25 bps rate

cut by the European Central Bank in April, as trade disputes are

expected to take a toll on economies.