German government bond yields rose on Tuesday, with the 10-year hitting 1% for the first time since June 2015, while investors braced for more hawkish signals from central banks this week.

Australia's central bank raised its cash rate by a unexpectedly large 25 basis points (bps) to 0.35%, the first hike in over a decade, and flagged more to come.

Germany's 10-year government bond yield was up 2.5 bps at 0.991%, after rising above 1% to 1.004%.

"Tactical trading looks most appropriate today, with U.S. rates at key levels and 10Y Bund close to 1%," Mizuho strategists said in a note to clients.

"Later this week, both the Fed and BoE look fairly clear cut regarding the amount of hikes to expect and the accompanying dialogue," they added. "Hints at what's to come are likely to be most interesting."

The Fed Open Market Committee (FOMC) meeting ends on Wednesday, while Bank of England (BoE) policymakers will gather on Thursday.

Investors will also look at U.S. jobs data due on Thursday for market direction.

Inflation was still the main subject for investors, with a market gauge of euro zone expectations at 2.49% on Monday after rising to 2.566% last week, the highest since 2012, according to European Central Bank (ECB) data..

"It is telling that inflation break-evens moved back to their highs, defying the usually positive correlation with oil prices and equities," Commerzbank analysts flagged in a research note to customers.

"This makes sense as the Chinese lockdowns could mean more (core) inflation pressure down the road while the ECB could feel more restrained in its normalisation drive," they added.

Some of Shanghai's 25 million people came out for brief walks and grocery shopping on Tuesday after more than a month under a COVID lockdown.

Germany's 10-year break-even rates, the difference in yield between the inflation-linked and nominal debt of the same maturity, was at 2.76%, just off their highest since August 2010 of 2.77%.

Italy's 10-year government bond yield rose 1.5 bps to its highest since March 2020 of 2.872%.

The spread between Italian and German 10-year bond yields tightened one bps to 187.5, after hitting its widest since June 2020 at 189.90. (Reporting by Stefano Rebaudo Editing by Mark Potter)