LONDON, May 30 Reuters Global bond markets face the biggest amount of net sovereign issuance so far this year in June, just as economic data throws rate cuts into doubt, testing investors39; sofar strong appetite for the debt.

Net government bond supply is likely to rise to 340 billion for the United States, euro zone countries and Britain, according to data from lender BNP Paribas, as redemptions fall and central banks continue to slash their holdings of the paper.

Although analysts expect markets to absorb the supply, it has the potential to add to upward pressure on yields which move inversely to prices and spook investors who were hoping that rate cuts would spur a bond market rally this year.

A pair of weak U.S. Treasury auctions on Tuesday may have been an early sign that the market, already grappling with strong economic data that has caused traders to push back their bets on when central banks will start cutting interest rates, is struggling to remain optimistic.

We still have a lot of supply that needs to be absorbed, said Camille de Courcel, head of G10 rates strategy for Europe at BNP Paribas, adding that the euro zone will see its second highest month of net issuance so far this year in June.

De Courcel said she is wary of buying longerdated bonds in June, even with the European Central Bank likely to lower interest rates, as economies recover and supply is strong. We are very mindful of the risks that yields head higher as we go into June, especially…