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UPDATE 1-German 10-year bond yields take lead from U.S. Treasuries

* Bond yields inch up, give up early falls

* German industrial output falls 1.1 pct in June

* But focus on stronger tone to U.S. jobs data

* Euro zone periphery govt bond yields http://tmsnrt.rs/2ii2Bqr (Recasts to reflect change in prices)

LONDON, Aug 7 (Reuters) - Germany's benchmark 10-year bond yield nudged up from one-month lows on Monday, following U.S. Treasury yields higher after last week's stronger-than-expected U.S. jobs numbers.

Bund yields had opened lower after data showed industrial output in Germany, the euro zone's biggest economy, unexpectedly fell 1.1 percent in June from a month earlier.

But the move proved short-lived, with yields in Germany and elsewhere in the single-currency bloc then creeping back up.

"The small increase in yields makes sense given the decent U.S. jobs numbers on Friday," Cyril Regnat, fixed income strategist at Natixis, said. "The U.S. data is likely to have relieved the ECB because the euro weakened."

The euro, while a touch firmer on Monday, has pulled back from a 2-1/2 year high hit last week at around $1.19.

Euro strength, which dampens inflation and hurts the economic recovery by lifting the cost of exports, could encourage the European Central Bank to maintain its ultra-loose monetary policy stance for longer than anticipated.

But renewed talk of a year-end rate rise from the U.S. Federal Reserve after Friday's data showed the U.S. economy created 209,000 jobs last month has lifted the dollar.

Germany's 10-year government bond yield rose 2 basis points to 0.49 percent after touching a one-month low on Friday at 0.45 percent.

Other long-dated bond yields in the euro zone were 1-2 basis points lower, with U.S. bond yields also edging up in London trade.

Still, analysts said thin bond supply in the euro zone this week should limit a rise in yields. Austria will sell 1.1 billion euros of bonds on Tuesday, followed by a 4 billion euro sale of five-year German bonds on Wednesday.

"This will be the last euro zone government bond supply before a two-week hiatus that should prove a supportive factor for all issuers," Mizuho analysts said in a note.

Investors were also expected to pay attention to a release due later showing the breakdown of ECB asset purchases in July.

In June, the ECB bought more than two billion euros of Italian and French bonds than it was supposed to, moving further away from a rule aimed at ensuring that its stimulus is evenly spread across the euro zone.

(Reporting by Dhara Ranasinghe; Editing by Catherine Evans and Alexander Smith)