TREASURIES-Bonds gain in advance of record 30Y bond auction

* Record $16 bln 30Y bond sale concludes November refunding

* Fed's Plosser sees no near-term inflation threat

* Weekly jobless claims fall more than expected

* 2Y yield briefly touched 8-month low in overnight trading (Updates market action, adds quote)

By Richard Leong

NEW YORK, Nov 12 (Reuters) - U.S. government debt prices rose on Thursday as investors anticipated solid demand for a record 30-year bond auction that wraps up this week's $81 billion November refunding.

The U.S. Treasury will auction $16 billion of 30-year Treasuries, the longest U.S. government debt maturity, following strong sales of three-year and 10-year notes earlier this week.

The 30-year bond appeals to investors seeking low-risk investments that offer decent long-term yields, even as the stock market has rallied more than 50 percent since March, analysts said.

"We believe that 30-years offer value for yield grabbers," said George Goncalves, head of fixed income rates strategy at Cantor Fitzgerald in New York.

The 30-year yield is about 3.50 percentage points higher than the two-year yield US2YT=RR and 1 percentage point higher than the 10-year yield.

A pullback on Wall Street added a safety bid for bonds just ahead of the 30-year bond auction.

Lingering concerns, however, over the credit-worthiness of the U.S. government because of its burgeoning deficit could nick demand for the new 30-year bond, analysts added.

The allure of U.S. debt will depend on the pace of economic recovery. The faster the economy comes out of the worst downturn in 70 years, the more quickly inflation will accelerate. That could spur the Federal Reserve to quicken its removal of stimulus, including near zero interest rates.

The Treasury Department will announce the results on the 30-year auction about 1 p.m. (1800 GMT).

FED'S ASSURANCE

In recent days, Fed officials have telegraphed that the U.S. central bank is a long way from dropping its super-easy monetary policy as long as the economy remains fragile.

"We're in much better shape than six months ago, but that does not mean everything is hunky-dory," the president of the Philadelphia Fed, Charles Plosser, told Market News. [ID:nN12304220]

Thursday's data supported the view of a slow U.S. economic recovery and the Fed sticking to its near zero rate policy. This pressured the two-year Treasury yield, which is most sensitive to the market's view on Fed policy, to 0.80 percent in overnight trading, the lowest in eight months.

The U.S. Labor Department said weekly jobless claims fell to 502,000 in the week ended Nov. 7, compared with a revised 514,000 in the prior week. Analysts polled by Reuters forecast 510,000. For more, see [ID:nOAT004352]

On the housing front, mortgage applications rose 3.2 percent on a jump in refinancing requests, according to an industry report. Loan demand to buy homes fell, suggesting sluggishness in housing market. [ID:nN12209444]

The yield on benchmark 10-year Treasury notes US10YT=RR was 3.46 percent, down about 2 basis points from late Tuesday.

The price on 30-year Treasury bonds US30YT=RR was up 13/32 at 101-26/32. Their yield, which moves inversely to their price, was 4.39 percent, down from 4.41 percent late Tuesday.

In the "when-issued" market, traders bet the new 30-year bonds US30YTWI=TWEB to yield just under 4.40 percent.

The U.S. bond market was closed on Wednesday in observance of Veterans Day. (Editing by Leslie Adler)