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REFILE-GLOBAL MARKETS-Stocks edge higher while euro falls with U.S. Treasury yields

(Refiles to fix typo in first paragraph to 'bank' from 'back')

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Euro loses ground after ECB news

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Wall Street gains after GDP data eases recession worries

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Oil stocks gain with stockpiles, Red Sea in focus

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China stocks bounce after stimulus

By Sinéad Carew and Amanda Cooper

NEW YORK/LONDON, Jan 25 (Reuters) - Global stocks edged up on Thursday while the euro fell as Europe's central bank kept rates unchanged and U.S. Treasury yields trended lower after data showed the U.S. economy grew more quickly than expected in the fourth quarter.

The U.S. economy grew as strong consumer spending defied dire predictions of a recession in 2023, with gross domestic product (GDP) increasing at a 3.3% annualized rate and full-year growth at 2.5%, according to the Commerce Department.

The U.S. dollar edged higher after the data prompted bets that the Federal Reserve would be in no rush to cut interest rates amid a generally stable economy.

The euro came under pressure after the European Central Bank kept interest rates unchanged at a record-high 4% as expected and ECB President Christine Lagarde said it was "premature to discuss rate cuts" for the euro zone economy, and that risks to economic growth are "tilted to the downside.".

"Probably why you're seeing weakness in the euro is the differential between European growth rates and U.S. growth," said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina.

Wall Street stock indexes were showing investor relief that the U.S. economy is holding up better than hoped.

"We're back to good news being good news," Zaccarelli said. "Even though this news increases the likelihood the Fed will wait longer to cut rates, the market's not down worrying about rate cuts. It's up because they think growth is not slowing as much as feared."

At 10:53 a.m. the Dow Jones Industrial Average rose 34.61 points, or 0.09%, to 37,841.00, the S&P 500 gained 15.97 points, or 0.33%, to 4,884.52 and the Nasdaq Composite gained 68.20 points, or 0.44%, to 15,550.12.

The MSCI world equity index, which tracks shares in 49 nations, gained 0.16% while Europe's STOXX 600 index rose 0.14%.

Treasury yields fell after a component of the U.S. economic report revealed that the pace of inflation fell below the Federal Reserve's 2% target.

"All they're looking at is the inflation number. They're just looking at that inflation component and they're saying that maybe we've pushed yields a little bit too high," said Steven Ricchiuto, U.S. chief economist at Mizuho Securities USA LLC.

The yield on benchmark 10-year Treasury notes rose to 4.1357% compared with its U.S. close of 4.178% on Wednesday. The two-year yield, which rises with traders' expectations of higher Fed fund rates, touched 4.3241% compared with a U.S. close of 4.378%.

In currencies, the European single currency was down 0.5% on the day at $1.083, having lost 1.87% in a month.

The dollar index, which tracks the greenback against a basket of currencies of other major trading partners, was up 0.3% at 103.59.

The dollar rose 0.06% against Japan's yen to 147.59. This was after the yen on Wednesday staged its largest one-day rally against the dollar in a month after hints of rate increases to come in Japan.

Earlier, China markets had surged on the back of revived investor confidence that helped offset a more muted performance elsewhere, while the euro held steady against the dollar ahead of a European Central Bank meeting.

Chinese blue-chips staged a robust rally, with the Shanghai Composite closing up 3% in its largest daily gain in nearly two years, after a series of measures by Beijing authorities to prop up the economy and the stock market.

In commodity markets, oil prices rose after data showed U.S. crude stockpiles fell more than expected last week and a fresh attack by Houthi forces on ships off Yemen's coast underscored the peril facing trade in a key global transit route.

West Texas Intermediate crude futures rose 1.57%, or $1.18, to $76.27 a barrel. Brent crude rose 1.47% , or $1.18, to $81.22

In precious metals, spot gold prices rose 0.34% to $2,019.39 an ounce.

(Additional reporting by Herbert Lash in New York, Dhara Ranasinghe in London and Tom Westbrook in Singapore: Editing by Shri Navaratnam, Will Dunham, Miral Fahmy and Chizu Nomiyama)

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