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Uneasy bond markets count down to ECB meeting

* Euro zone bond yields steady

* Spotlight falls on Thursday's ECB meeting

* Yields holding at higher levels after Draghi Sintra speech

* Euro zone periphery govt bond yields http://tmsnrt.rs/2ii2Bqr

LONDON, July 17 (Reuters) - Nervous euro zone bonds markets were steady on Monday, biding their time ahead of this week's European Central Bank meeting for the latest signals on how the central bank plans to scale back its ultra-loose monetary policy.

The ECB meets this Thursday, three weeks after comments from central bank chief Mario Draghi at Sintra in Portugal that were seen as opening the door to policy tweaks in the coming months triggered a jump in both government bond yields and the euro .

Bond yields have pulled back from multi-month highs hit in the wake of those comments thanks to weak U.S. economic data and dovish comments from the U.S. Federal Reserve. But they remain at elevated levels in a sign that bond investors are now positioning for a change in stance from the ECB.

Germany's benchmark 10-year bond yield was steady on Monday at 0.52 percent - down from 18-month highs hit a week ago at 0.58 percent but roughly double the levels it traded at just before Draghi's speech.

Commerzbank described the speech as the "beginning of the end" of quantitative easing (QE) in the euro zone, noting that the rise in German bond yields was in line with the rise seen in U.S. Treasury yields in the weeks after the U.S. Fed signaled an unwinding of its QE program in May 2013 in what became known as the "taper tantrum."

"Judging by the U.S. experience, the further upside in Bund yields would be some 70 basis points over the next couple of months and some 120 bps by the time the ECB starts tapering," said Christoph Rieger, head of rates and credit research at Commerzbank.

"Whether this will be realized crucially depends on how the ECB conducts its exit."

The ECB may this week drop a reference to its readiness to increase the size or duration of its asset-purchase program before announcing in the autumn how and when it will start winding down its bond-buying.

But no major changes are expected, with Draghi possibly using the opportunity to tame market expectations for tapering.

The ECB is likely to wait until September to announce a tapering of its 60 billion euros of monthly asset purchases, probably starting in early 2018, according to Reuters poll.

"If anything, I think the ECB will be at pains to say this week nothing has changed and actually effectively message to markets that they shouldn't get ahead of themselves in anticipating a tightening of conditions," said Mark Dowding, a portfolio manager at BlueBay Asset Management.

Most euro zone bond yields were broadly flat on Monday, with a slight outperformance of peripheral debt markets . For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.bi z / c m s / ? p a g e I d = l i v e m a r k e t s

(Reporting by Dhara Ranasinghe; Editing by Andrew Heavens)