* U.S. long-dated yields hit more than three-month highs * U.S. ADP jobs report in September was better than expected * Markets keeping an eye on debt ceiling as deadline looms (Adds new comment, U.S. data, Treasury table, updates prices) By Gertrude Chavez-Dreyfuss and Tom Westbrook NEW YORK/SINGAPORE, Oct 6 (Reuters) - U.S. Treasury benchmark 10-year yields fell from more than three-month peaks on Wednesday, as investors pulled back from recent selling to buy the note, but the outlook for rates remained tilted to the upside amid optimism about growth. A surge in yields earlier in the session had reflected investor concerns that soaring energy prices could drive broader inflationary pressures. U.S. crude futures hit an almost seven-year high on Wednesday amid a global fuel crunch that has unnerved markets and sent coal and natural gas prices soaring. U.S. Treasury 20-year and 30-year yields also retreated from their June highs. An earlier report showing U.S. private payrolls increased more than expected in September to 568,000 jobs pushed Treasury yields higher. But that was short-lived as buyers stepped in to take advantage of Treasuries" oversold conditions. "We have said all year that 10-year yields should be in the 1.75% to 2% by the end of the year," said Tony Rodriguez, head of fixed income strategy at Nuveen. "We"re kind of heading in that direction. Our view is that we"ll get to that level, but probably at the low end, given that over the summer, we saw some weakness related to the resurgence of COVID," he added. The 10-year yield earlier in the global session to 1.573%, but was down nearly 2 basis points at 1.5154%. Nominal yields have increased the last few weeks on expectation that the Federal Reserve will soon begin tapering asset purchases, and traders are awaiting more U.S. labor data for clues as to the timing and tone of policy tightening. Yields on 20-year and 30-year Treasuries also jumped to their highest since June. In mid-morning trading, 20-year yields were down 2.3 basis points at 2.0185%, while those in 30-year bonds slid 2.5 basis points to 2.0746%. On Tuesday, breakeven inflation expectations on five-year Treasury Inflation-Protected Securities (TIPS) rose to 2.62%, the highest since late July and the same rate on 10-year TIPS hit 2.458%, the highest since June. Both breakeven inflation rates came slightly down on Wednesday. The earlier rise in longer-dated yields also steepened the curve and the gap in yield between two-year and 10-year yields rose to 127 basis points, its widest since June. By mid-morning, that yield curve had flattend to 121 basis points as long-term rates fell. In the Treasury bills market, yields on the one-month rose 2 basis points to 0.1293% ahead of the Oct. 18 debt ceiling deadline, while those on 3-month bills were steady at 0.0406%. Senate Democrats are set to try again on Wednesday to extend the U.S. government"s borrowing authority to head off a catastrophic default, after President Joe Biden suggested they could change the chamber"s rules to bypass a Republican roadblock. "We have seen the move away from short-term bills in previous debt ceilings," said Nuveen"s Rodriguez. "Right now, the premium you"re seeing in bills was not as high as the last time. We still think that Congress will, as it always will, raise the debt ceiling at the 11th hour." October 6 Wednesday 10:39AM New York / 1439 GMT Price Current Net Yield % Change (bps) Three-month bills 0.04 0.0406 0.000 Six-month bills 0.055 0.0558 0.000 Two-year note 99-234/256 0.2935 0.006 Three-year note 99-142/256 0.5279 0.006 Five-year note 99-128/256 0.9781 0.000 Seven-year note 99-160/256 1.3064 -0.009 10-year note 97-148/256 1.5154 -0.016 20-year bond 95-148/256 2.0214 -0.022 30-year bond 98-80/256 2.0761 -0.024 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 9.75 0.00 spread U.S. 3-year dollar swap 13.00 0.00 spread U.S. 5-year dollar swap 8.00 0.50 spread U.S. 10-year dollar swap 1.00 0.25 spread U.S. 30-year dollar swap -26.25 0.25 spread (Reporting by Gertrude Chavez-Dreyfuss in New York and Tom Westbrook in Singapore; Editing by Kim Coghill and Alison Williams) Our Standards: The Thomson Reuters Trust Principles.