* Euro zone periphery govt bond yields tmsnrt.rs/2ii2Bqr MILAN, Jan 19 (Reuters) - Italian government bond yields were lower on Tuesday, ahead of a confidence vote in the upper house Senate that could force prime minister Giuseppe Conte to resign. But expectations that snap elections were unlikely, coupled with ECB stimulus to fight the adverse impact of the novel coronavirus, limited any selloff of Italian government bonds. Conte won a confidence vote in the Chamber of Deputies on Monday as he clung to power after a junior partner quit the ruling coalition and triggered a political crisis. He will face a tougher test in the Senate on Tuesday, where the government had only a slim majority even when Italia Viva, which began the crisis, was part of the coalition. “Italy should remain in focus this morning with Conte asking for an informal vote of confidence in the Senate,” Commerzbank analysts said in a research note. Italy’s 10-year government bond yield was down 2 basis points at 0.586%. The closely-watched spread between German and Italian government bond yields was at 110.4 basis points, after hitting 98 basis points a week ago. Some analysts expected appetite for high-yielding debt would prevail even in the worst-case scenario of snap elections. “With snap elections the spread is likely to jump to 150 basis points, but after that, new buyers will come to the market and the spread will gradually move versus previous levels,” said Anna Guglielmetti, head of institutional portfolio management Italy at Credit Suisse. Investors will focus on a ZEW economic sentiment survey, at 1000 GMT, which might boost hopes of stronger economic growth ahead of PMI data. Germany’s 10-year government bond yields were up 0.5 basis points at -0.515%. U.S. Treasury secretary nominee Janet Yellen will tell the Senate on Tuesday that the government must “act big” with its next coronavirus relief package, while she is expected to face questions over his tax and spending proposals. (Reporting by Stefano Rebaudo; editing by Barbara Lewis)