US 30-year Treasury yields drop from multi-year highs

Adds background and Treasury comment in paragraphs 3-5

LONDON/WASHINGTON, Aug 19 (Reuters) - Yields on 30-year U.S. Treasuries fell sharply on Wednesday from around their highest level in 19 years, after the Treasury Department announced it would double the size of liquidity support buyback operations for longer-dated bonds.

The yield on 30-year U.S. Treasuries US30YT=RR fell almost 10 basis points to 5.187%. It had touched 5.337% on Tuesday, its highest since 2007, as investors fretted about inflation and high levels of government debt.

The change, which the Treasury said will be effective between September 9 and November 4, also pushed yields on 10-year Treasuries into further declines on signs that Washington will act to support the market. Amid a protracted U.S.-Iran conflict, fears about inflation and sovereign debt have helped drive a global selloff that has pushed long-term borrowing costs to multi-decade highs.

"What we've seen in the course of recent days is that the long end of the bond market has obviously been selling off and potentially becoming somewhat problematic for the play through to other asset classes," said Jeremy Stretch, head of G10 FX Strategy at CIBC.

"This measure shows the U.S. Treasury recognizes what is going on the bond market and is prepared to adjust policy in order to limit pressures on the market."

(Reporting by Harry Robertson and Douglas Gillison on Washington; additional reporting by Dhara Ranasinghe in London; Editing by Samuel Indyk and Emelia Sithole-Matarise)