BRUSSELS - High inflation and aggressive central bank rate hikes have created challenging conditions for government bond markets, but the ease of doing trade has held up relatively well, officials told a European bond conference on Wednesday.

Anthony Linehan, who is deputy director of funding and debt management at Ireland's National Treasury Management Agency, said the debt agency was sensitive to which parts of the bond market might need support.

"But we need to be conscious that the vast majority of trades have gone well," he told the Association for Financial Markets in Europe's (AFME) conference in Brussels.

"In a year of huge adjustment, it's not been a bad year for bonds," he added.

Linehan also said that flexibility was needed but that Ireland's debt agency had not had big complaints from investors about market liquidity.

Some euro zone countries have eased rules for the banks that manage the trading of their government debt to help them cope with some of the most challenging market conditions in years, officials told Reuters recently.

Rodérick Joniaux, European government bonds product manager at bond trading platform Tradeweb, noted trading volumes had risen in recent months, but added that higher interest rates had not changed the way clients were trading.

Ireland's Linehan said bonds were becoming more attractive again, while Maria Cannata, chairwoman at online trading platform MTS said the bond selloff meant yields had now reached more "normal" levels and that there would be more bonds circulating in the market.

Years of bond-buying stimulus from the European Central Bank and other major central banks had kept government bond yields at ultra-low levels and suppressed volatility.

This year's surge in bonds yields against a backdrop of high inflation and rising interest rates has pushed Germany's benchmark 10-year Bund yield to 2.06% versus -0.18% at the end of last year, set for their largest annual rise since at least the 1950s, according to Refinitiv data.

Speaking on the same panel about bond market liquidity, Zoeb Sachee, head of euro linear rates trading at Citi, said the main cause of heightened volatility in bond markets was uncertainty around where central bank terminal rates would end up.

"On a positive note, as we get closer to a peak in rates, bond yields are more attractive and you will see a return of investors from a broad base. Until then, we remain in choppy times," he said.

(Reporting by Dhara Ranasinghe; Editing by Amanda Cooper and Emelia Sithole-Matarise)