U.S. Treasury yields edged up slightly on Wednesday, stabilizing after sharp falls the previous day, ahead of key PCE inflation data and Federal Reserve Chairman Kevin Warsh's speech later this week at the Jackson Hole symposium.

The 10-year U.S. Treasury yield rose 0.6 basis points to 4.645%, although it remained close to Tuesday's 12-day low of 4.619%, Tradeweb data showed.

Bonds broadly benefit from a decline in oil prices, which sent eurozone and U.K. government bond yields lower on Wednesday.

The 10-year German Bund yield fell to a 12-day low of 3.186%, while the 10-year U.K. gilt yield dropped to a 13-day low of 4.979%.

Oil prices have been falling for three days, prompted initially by U.S. Treasury Secretary Scott Bessent announcing measures earlier this week to economically isolate Iran.

The fall in oil prices gained additional momentum from news that Iran and Oman are in talks to reopen the Strait of Hormuz for safe maritime passage.

"There were tentative signs of progress in the Middle East, which helped oil prices and rates lower and risky assets higher," said Mohit Kumar, global economist at Jefferies.

Brent oil last traded 3% lower at $85.94 a barrel, having come down from Friday's close at $94.39 a barrel.

"While highly uncertain and dependent on the response of the U.S. (which isn't involved in the talks), the hope is that such a deal could create a path for Iran and the U.S. to return to the earlier Memorandum of Understanding," KBC Bank analysts said in a note.

Investors remained cautious ahead of U.S. personal consumption expenditures data--the Fed's favored measure of inflation--at 1230 GMT Wednesday and Warsh's speech Friday at the Federal Reserve Bank of Kansas City's annual Jackson Hole symposium, which could impact U.S. interest-rate expectations.

However, falling oil prices could "give some relief for Warsh," Jefferies' Kumar said. Jefferies also expects core inflation to remain benign over the coming months which should allow interest rates to stay on hold, he said.

The PCE data for July will potentially provide some insight into what to expect at the Fed's September policy meeting. The PCE index is forecast to decelerate to 3.6% in July from 3.7% in June, according to The Wall Street Journal's poll of economists.

Warsh's debut Jackson Hole speech follows the Fed's July press conference that left markets uncertain about his stance on inflation and his framework for fighting it due to a lack of forward guidance, said Kevin Thozet, member of Carmignac's investment committee.

"Markets will be highly sensitive to any hint about the Fed's reaction function," Thozet said.

The Treasury last week announced it would double buybacks of long-end securities to at least $4 billion from $2 billion per operation.