LONDON, June 17 (Reuters) -

German government bond yields rose on Monday in calmer trading after a dramatic Friday when political jitters sent them tumbling and pushed up the risk premium on French and Italian debt.

Germany's 10-year bond yield, the benchmark for the euro zone bloc, rose 6 basis points (bps) to 2.42%, after falling 26 bps last week.

France's 10-year bond yield was down 1.5 bps at 3.16%, while Italy's 10-year yield was 2 bps higher at 3.93%.

French President Emmanuel Macron's decision to call a parliamentary election has spooked investors who fear the move could pave the way for Marine Le Pen's far-right Rassemblement National to come to power and ramp up spending, adding to the country's high debt levels.

Le Pen sought to allay some of those fears over the weekend, saying she would not seek Macron's resignation and that she is "respectful of institutions", in an interview with Le Figaro.

Philip Lane, the chief economist of the European Central Bank, on Monday said the ECB did not need to step into the markets, as recent market turmoil fuelled by political uncertainty was not "disorderly".

"What we are seeing in the markets is a repricing, but it is not in the world of disorderly markets right now," Lane said in a Reuters NEXT Newsmaker interview at the London Stock Exchange.

The closely watched "spread" between French and German borrowing costs stabilised after hitting its highest since 2017 last week.

The gap between French and German 10-year yields was at around 77 bps, down 4 bps from Friday after climbing 29 bps last week in its biggest weekly rise since 2011.

The Italian-German yield gap tightened 6 bps to 151 bps, after rising 23 bps last week as investors bought safe-haven German bonds, pushing their yields lower compared to those of other countries.

"The market focus will firmly remain on (French bond) spread dynamics after last week's wild ride," said Rainer Guntermann, rates strategist at Commerzbank.

"Several days of stabilisation seem needed to calm investors' nerves. However, unlike in 2017, there is no quick fix in sight with French politicians not keen to compromise for now and the ECB's hands tied."

Germany's two-year bond yield, which is more sensitive to European Central Bank rate expectations, was 5 bps higher at 2.81%.

Investors were looking ahead to U.S. retail sales data on Tuesday, which should inform Federal Reserve policymakers about the health of the American consumer after weak inflation data last week raised hopes the U.S. central bank would be cutting interest rates in September.

The Bank of England is widely expected to leave interest rates unchanged at 5.25% in its meeting on Thursday, as it waits for more progress on inflation in the services sector. (Reporting by Harry Robertson Editing by Bernadette Baum, Shinjini Ganguli and Paul Simao)