(Updates prices, adds BlackRock comment)
* Catalan leader due to address parliament at 1600 GMT
* Could ask for independence declaration
* Yields nudge away from low visited on Monday
LONDON, Oct 10 (Reuters) - Spanish government bond yields held above one-week lows on Tuesday as investors awaited a speech from Catalonia's secessionist leader in which he could ask the regional government to declare independence from Spain.
Yields, which move inversely to prices, have fallen over the last couple of trading sessions on hopes that economic and political pressures may temper Carles Puigdemont's address to the Catalan parliament at 6 p.m. (1600 GMT).
Spain's benchmark 10-year bond yields were a touch lower on Tuesday, but above lows hit the previous session as some investors prepared for a unilateral declaration which Madrid has vowed to respond to immediately.
At 1.66 percent at 1100 GMT, yields remained some distance from six-month highs of 1.81 percent hit last week following the illegal referendum that was marred by a violent police crackdown, but were off Monday's low of 1.64 percent.
"It seems that the most likely path forward is one of escalation by the separatists with a declaration of independence this week," said Apolline Menut, an economist at Barclays.
One of the options at Madrid's disposal is to trigger Article 155 of the constitution, which allows central government to take control of devolved powers.
Analysts said such a move was a "nuclear option" that would inflame tensions and could further taint the reputation of Prime Minister Mariano Rajoy who leads a minority government.
Spain's 10-year bond yield rose as much as 3 basis points on Tuesday to nudge just above 1.70 percent in early trading before pulling back.
German equivalents flatlined at 0.45 percent, while most other euro zone bond yields were little changed.
Alexander Aldinger, a strategist with BayernLB, said the risk premium on Spanish bonds could climb back to at least last week's level and the gap between German and Spanish yields could be "significantly higher".
In a sign of concerns on the ground, some Catalan savers were shifting their bank accounts to lenders and branches in other regions of Spain on Monday. A number of Catalan firms have also decided to relocate their offices out of the region.
For others, recent volatility in Spanish bond markets has proved an opportunity.
BlackRock, the world's largest asset manager, has "taken advantage" of the recent widening in Spanish bond yield spreads, the fund's deputy chief investment officer for fixed income said on Tuesday.
Scott Thiel told reporters he considered it a base case scenario for Spain to stay unified.
Elsewhere, National Bank of Greece is selling the country's first bank bond in the public market since 2014, another crucial step in the country's bid to re-establish financial independence.
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(Editing by Raissa Kasolowsky and Ed Osmond)