TREASURIES-Yields rise after U.S. GDP data, in line with foreign bonds

* U.S. Q3 GDP rises 2.9 percent, lifts yields

* December Fed hike prospects rise to more than 80 pct

* U.S. yields move in line with German, UK bonds (Adds comment, details, updates prices)

By Gertrude Chavez-Dreyfuss

NEW YORK, Oct (HKSE: 3366-OL.HK - news) 28 (Reuters) - U.S. Treasury yields climbed to five-month peaks on Friday, helped by gains in German and British bonds as well as data showing the world's largest economy grew at a faster pace than expected in the third quarter, suggesting U.S. interest rates will most likely rise in December.

U.S. Treasuries have also been moving in tandem with global bond markets all week. German 10-year bund and UK gilt yields have been on a tear this week, surging to multi-month highs, on a growing view that their central banks would either hold off further easing or in the case of the European Central Bank, that it would slow the pace of bond purchases after the March deadline.

"The larger moves during the week have been driven by changing views on the next stage for monetary policy, with central bankers increasingly signaling their hesitation to push rates significantly lower than current levels," said Marvin Loh, senior global markets strategist at BNY Mellon in Boston

Stronger-than-expected U.S. gross domestic product data for the third quarter helped pushed Treasury yields higher as well, with the rates futures markets now pricing in a more than 80 percent chance the Federal Reserve would tighten rates at its December policy meeting.

Gross domestic product grew at a 2.9 percent annual rate after expanding 1.4 percent in the second quarter, the Commerce Department said in its first estimate. That was the strongest growth since the third quarter of 2014.

"The news of a decent acceleration in GDP growth to well above its potential will leave Fed officials a lot more confident about the outlook," said Paul Ashworth, chief U.S. economist at Capital Economics in Toronto. "A rate hike is on the way."

In mid-morning trading, benchmark 10-year Treasury notes were down 2/32 in price to yield 1.852 percent, up from 1.843 percent late on Thursday. Earlier, 10-year yields hit five-month highs of 1.879 percent.

U.S. 10-year yields have risen nearly 25 basis points in October, on track for its best monthly performance since February last year.

U.S. 30-year bonds were 6/32 down in price to yield 2.612 percent, up from Thursday's 2.602 percent. They touched five-month peaks of 2.639 percent earlier on Friday.

U.S. 30-year yields, rising about 27 basis points this month, were on pace for their best monthly gain in 1-1/2 years.

U.S. two-year note yields were at 0.876 percent, slightly lower than Thursday's 0.884 percent. They hit a five-month high of 0.9 percent following the GDP data.

German 10-year bund yields rose to more than five-month peaks of 0.219 percent, while those for 10-year British bonds advanced to more than four-month highs of 1.312 percent.

(Reporting by Gertrude Chavez-Dreyfuss; Editing by Bernadette Baum and Chizu Nomiyama)