Nov 12 (Reuters) - Euro zone money markets moved back on Friday to pricing two full European Central Bank rate hikes by the end of next year. The bloc’s bond markets, like others, have been volatile in recent weeks, with a focus on when major central banks will start to hike rates as markets fear inflation is proving less transitory than initially expected. Following the ECB’s policy meeting in October, markets moved to price in one 10-basis point (bp) rate hike by July 2022 and two hikes by October 2022, but calmed down once policymakers pushed back more strongly against the pricing and the Bank of England did not deliver an expected rate hike a week after. But U.S. October inflation numbers came in higher than expected on Wednesday, raising questions about how quickly the U.S. Federal Reserve might need to act. After pricing in a full ECB hike by September 2022 on Thursday, they moved to price in two by December 2022 on Friday. “This is a cyclical play on inflation playing out here. If punters were really afraid, we wouldn’t be talking about 20bps ECB/50bps of Fed hikes,” analysts at AFS Group said. In the broader market, Germany’s 10-year yield, the benchmark for the euro area, was unchanged at -0.23%. Italy’s 10-year yield was up 4 bps to 1.00% for the first time in a week, pushing the closely watched risk premium it pays on top of German bonds above 120 bps. The focus remained on inflation on Friday. Euro zone price growth will fall back below the ECB’s 2% target in 2023, so conditions for an interest rate hike have not been met, Lithuanian policymaker Gediminas Simkus said. The comments, however, imply that inflation will remain elevated for longer than the ECB’s economic projections suggest. Those see inflation falling back under the 2% target next year. Supply chain bottlenecks that are dampening euro zone growth and pushing up inflation will linger throughout 2022, ECB policymaker and Finnish central bank governor Olli Rehn said on Friday. Elsewhere, Austria hired J.P. Morgan and UniCredit as advisers for its issuance of an inaugural green bond next year. (Reporting by Yoruk Bahceli Editing by Mark Potter)