European long-dated government bonds edged higher on Tuesday, buoyed by a rally in US Treasuries, while shorter-dated notes declined amid growing market expectations that the European Central Bank could deliver two interest rate hikes before the end of the year.

The yield on the 30-year German Bund slipped 1 basis point to 3.76%, while the yield on the 30-year US Treasury fell 4 basis points. In the UK, the 30-year gilt yield declined 2 basis points to 5.79%.

The move in US bonds came after the Treasury Department signaled it could tap its cash reserves to fund buybacks of long-dated securities, providing support to the market. Global long-term bonds have been under sustained selling pressure recently amid fiscal concerns, pushing yields to their highest levels in more than a decade. Although the 30-year US Treasury yield declined on Monday, it remains near levels not seen since 2007.

In contrast, the German two-year yield rose 3 basis points to 2.86%, with the short end underperforming and flattening the yield curve. Traders now price in approximately 45 basis points of cumulative rate hikes from the European Central Bank by year-end, slightly above the levels reflected on Friday.

French government bonds continued to face headwinds from fiscal worries and political risks, with the 10-year yield hovering near its highest level since late 2008. The spread between French and German 10-year yields was steady around 87 basis points. Should it widen to 88.5 basis points, it would mark the most stretched level since 2012.

Market snapshot: German 10-year Bund yields were broadly flat at 3.26%, with Bund futures little changed at 123.82. Italy's 10-year yield held steady at 4.08%, keeping the Italy-Germany spread at 83 basis points. France's 10-year yield dipped 1 basis point to 4.13%, while the 10-year UK gilt yield eased 1 basis point to 5.06%.