European government bond yields increased slightly on Wednesday after U.S. Federal Reserve Chair Jerome Powell said the central bank still has a long way to go in meeting its inflation target. This had already been priced in by markets. Short-dated yields reached fresh highs and bets on policy rates rose, ahead of the testimony of the US Fed Chair and nominees for three Fed Board seats. The Bank of England may tighten policy further as UK consumer price inflation was higher than expected in May. Euro area short-dated yields are edging towards levels last seen before a banking crisis disrupted financial markets in March.