TREASURIES-U.S. yields up from 6-week lows on stock gains, Fed comments

* US bond yields up with global stock markets, oil price

* Yellen's comments on economy boost demand for risky assets

* Fed's Dudley touts "cautious" approach to rate hikes (Updates data, adds quote)

By Dion Rabouin

NEW YORK, April 8 (Reuters) - U.S (Other OTC: UBGXF - news) . Treasury debt yields rose from six-week lows on Friday as a rebound in global stock markets, a surge in oil prices and comments by Federal Reserve Chair Janet Yellen on interest-rate hikes spurred selling in U.S. government bonds.

Wall Street rose in early trading, with the benchmark S&P 500 up 0.6 percent, and a gauge of global stocks gaining 0.9 percent.

Crude futures surged about 6 percent as encouraging economic indicators in the United States and Europe boosted hopes of rising demand.

"We seem to be being pulled in a lot of different directions for a variety of reasons," said Societe Generale (Swiss: 519928.SW - news) head of U.S. rates strategy Subadra Rajappa. "But I would say that the correlation with oil is number one on the list as well as equities."

After Thursday's market close, Yellen said in a rare appearance with former Fed chairmen Ben Bernanke, Alan Greenspan and Paul Volcker that the U.S. economy was close to full strength. She (Munich: SOQ.MU - news) said inflation would not be held down much longer by the strong dollar and low oil prices, putting the central bank on track for further rate hikes.

Treasury yields were also buoyed by comments by Japanese Finance Minister Taro Aso early Friday, who warned that rapid currency moves were "undesirable." He said the yen's recent rally was "one-sided" and that Japan would take steps as needed to address it.

The yen rose by as much as 2 percent on Thursday to its highest in 17 months. It (Other OTC: ITGL - news) has gained nearly 10 percent against the dollar since the start of April.

Thursday's yen rally was a big reason for a concurrent rise in Treasuries prices, Rajappa said.

"When you start getting past 110, you start triggering the market fears about intervention coming from the Bank of Japan," she said.

Intervention would strengthen the dollar against the yen and drive Treasury yields and riskier assets higher, analysts said.

Yields moved modestly higher after New York Fed President William Dudley said risks were "slightly" tilted to the downside, towing the line Yellen set last week that the Fed should raise rates cautiously.

Benchmark 10-year Treasuries fell 11/32 in price as their yields rose 4 basis points to 1.729 percent. Those yields had fallen to their lowest since Feb. 24 on Thursday.

Prices on 30-year Treasuries fell by more than 1 point with yields rising nearly 6 basis points to 2.568 percent.

(Reporting by Dion Rabouin; Editing by Bernadette Baum)