* U.S. consumer sentiment weighs on Bunds
* G20 meeting unlikely to soothe euro strength concerns
* Italian bonds seen vulnerable in run-up to elections
By Marius Zaharia and Ana Nicolaci da Costa
LONDON, Feb 15 (Reuters) - Forecast-beating U.S. consumer sentiment figures pushed German Bund prices lower on Friday, but the risk of an inconclusive result in Italian elections was expected to limit losses in the near term.
The Thomson Reuters/University of Michigan preliminary reading on the consumer sentiment rose to 76.3 from 73.8 in January, topping economists' forecasts of 74.8.
The release raised the prospect that the recovery in the global economy will eventually filter through to the euro zone as well. Data on Thursday showed the region sank deeper than expected into recession last year.
Bund futures were last 21 ticks lower on the day at 142.38, having traded as high as 143.01 before the U.S. data. German 10-year yields were 2.2 basis points higher at 1.657 percent.
"Most of the volatility is coming through from the United States, where we've had some pretty decent data recently," said David Keeble, global head of fixed income strategy at Credit Agricole.
Bund yields traded in a narrow 1.60-1.70 percent range in recent weeks, but outperformed U.S. Treasuries, with the spread widening about 10 bps from mid-January levels to 37 bps. If the euro zone manages to catch up with the other major economies, and if political tensions in its weaker states start to ease, the spread should narrow to 20 bps or less, Keeble said.
Near-term, though, Italian elections should keep Bunds well-bid, traders said.
A surge in opinion polls by former Prime Minister Silvio Berlusconi is seen as raising the risk of a fragmented parliament, complicating efforts to overhaul the economy.
A rise in Italian and Spanish yields at the start of the month was tempered this week by renewed buying interest from domestic investors, traders said. But volatility can come back at any time.
"Things seemed to have calmed down, but Italian elections are a pretty big risk and we've got Spanish supply next week which will give people a new reason to sell," one trader said.
Italian 10-year yields were steady at 4.40 percent, some 30 bps higher than January lows, but also about 30 bps lower than February's highs. Equivalent Spanish yields were 5.20 percent, roughly in the middle of a 4.9-5.5 percent range seen in recent weeks.
Before the start of next week, investors will focus on a meeting of officials from the Group of 20 major economies. The wording of their final statement is expected to confirm that Japan will escape any censure for its expansionary policies which have driven the yen lower, reviving talk of "currency wars".
"The market thinks the G20 cannot do very much about this, it basically means that the euro in current conditions will have a tendency to appreciate ...," Elwin de Groot, senior market economist, at Rabobank said.
"Taking these things together - economic weakness (and) persistent prospect of potential further upward pressure on the euro - that could provoke action by European monetary policymakers. For the Bund, it's positive because it raises the potential for falls in money market rates."