GLOBAL MARKETS-US dollar falls; bonds rise on value play

* Bond buyers find value after post-US job data sell-off

* Euro rises above $1.40, dollar buying runs out of steam

* Oil rises above $69 as dollar eases

* Wall Street stocks edge higher, Texas Instuments gains (Updates with U.S. markets activity; changes dateline, previous LONDON)

By Herbert Lash

NEW YORK, June 9 (Reuters) - The U.S. dollar fell on Tuesday as investors questioned whether an improving economy warrants talk of higher U.S. interest rates this year after all, while government debt prices rose as investors saw value after last week's sell-off.

The euro rose above $1.40 and sterling rallied sharply after the U.S. Treasury said 10 of the biggest American banks could repay $68 billion in taxpayer money received during the height of the credit crisis, boosting hopes the worst is over.

Still, investors were less certain that the Federal Reserve would raise rates by year's end, a view that had gained traction last week after data showing a slower pace of U.S. job losses in May boosted the dollar and two-year Treasury yields.

U.S. and euro zone government bond prices rose as investors bought cheaper paper, viewing the sell-off of recent sessions as overdone, given the still fragile state of the economy.