0727 GMT - Yields on eurozone government bonds edge higher as prospects of a U.S.-Iran peace deal fade, raising concerns about prolonged supply chain disruptions and inflation risk. Bond market investors are cautious as "Iran and the U.S. appear to harden their positions", Deutsche Bank Research strategists say in a note. Rises in yields are limited, however, after data Wednesday showed U.S. inflation fell in line with expectations. This reduced prospects of the Federal Reserve raising interest rates next month. Ten-year Bund yields rise 0.5 basis points to last trade at 3.162%, Tradeweb data show.