* U.S. "Empire State" data stronger than expected
* World Bank raises its global growth outlook for 2013
* Dollar extends gains versus yen, euro; oil also rises
* U.S. government debt falls as inflation seen rising
By Herbert Lash
NEW YORK, Jan 15 Global equity markets pushed higher and the dollar advanced on Wednesday after positive economic data and stronger-than expected earnings from Bank of America pointed to continued improvement in the U.S. economy.
U.S. producer prices posted their largest gain in six months in December as the cost of gasoline rebounded strongly, but inflation pressures remained benign.
In addition, a manufacturing gauge in New York state jumped to its highest level in 20 months in January as new orders soared, the New York Federal Reserve said.
The Labor Department said its seasonally adjusted producer price index rose 0.4 percent last month, the biggest rise since June, after slipping 0.1 percent in November.
The New York Fed's "Empire State" general business conditions index rose to 12.51 in January from a revised 2.22 in December, to hit its highest since May 2012. Economists polled by Reuters had expected a reading of 3.75.
"That is in line with the theme the economy is slowly but surely accelerating," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
Bank of America Corp said quarterly profit surged nearly $3 billion as revenue increased and mortgage losses plunged in the clearest sign yet the bank was shaking off the impact of the financial crisis.
Bank of America shares rose 3.2 percent to $17.30, the highest since May 2010.
MSCI's all-country world index rose 0.38 percent, while shares in Europe hit 5-1/2 year highs, buoyed by a better global growth outlook from the World Bank.
The World Bank late on Tuesday raised its forecast for global growth for the first time in three years as advanced economies started to pick up pace, led by the United States.
The World Bank raised its forecast for global growth this year by two-tenths of a point to 3.2 percent, and predicted a faster pace for both 2015 and 2016.
Also, data confirmed that private consumption in Germany rose 0.9 percent in 2013, indicating underlying strength in Europe's biggest economy even though headline gross domestic product grew just 0.4 percent for the year.
The pan-European FTSEurofirst 300 index of leading regional shares rose 1.0 percent to 1,339.51.
On Wall Street, the Dow Jones industrial average gained 96.17 points, or 0.59 percent, at 16,470.03. The Standard & Poor's 500 Index was up 7.48 points, or 0.41 percent, at 1,846.36. The Nasdaq Composite Index was up 20.91 points, or 0.50 percent, at 4,203.92.
The dollar advanced, with the dollar index up 0.46 percent to 81.031. Against the yen, the dollar rose 0.32 percent to 104.54 after gaining more than 1 percent on Tuesday.
The euro fell 0.64 percent to $1.3591.
"The data that we've since the payrolls report Friday has been quite positive," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange.
U.S. Treasuries yields rose on expectations inflation may start picking up and potentially bring forward when the Federal Reserve starts raising interest rates.
Benchmark 10-year Treasury notes were last down 9/32 in price to yield 2.9005 percent.
February Brent crude rose 61 cents to $107.00 a barrel. U.S. crude for February delivery rose $1.22 to $93.81 a barrel.