TREASURIES-Prices fall after weak TIPS auction

(Rewrites to reflect market's shift to losses from morning gains, TIPS auction)

* Treasury sells $7 bln 30-year TIPS to weak demand

* Yields rise as invstors reposition after Fed meeting

NEW YORK, June 19 (Reuters) - U.S. Treasuries prices extended losses on Thursday after the United States had to pay more to sell $7 billion in new 30-year Treasuries Inflation-Protected Securities (TIPS). The TIPS were sold at a high yield of 1.116 percent, around 3 basis points higher than where the debt traded before the sale. "It was much weaker than we thought," said Rick Klingman, a Treasuries trader at Societe Generale in New York. The weakness came after bonds rallied on Thursday morning as investors covered bearish Treasuries positions and readjusted bets following the Federal Reserve's relatively dovish statement from its June meeting on Wednesday. "The shorts are reduced and people are left long after that TIPS auction, so there is a little bit of hedging," Klingman said. The benchmark 10-year U.S. Treasury note tumbled 10/32 in price and its yield rose to 2.63 percent from 2.57 percent at 8:55 a.m (1255 GMT) on Thursday. The 30-year bond dropped 1-6/32 in price, pushing its yield to 3.47 percent, up from 3.40 percent at 8:55 a.m (1255 GMT).

(Editing by Jan Paschal)