FOREX-Dollar falls to two-week low as benign inflation, U.S. yields weigh

    * U.S. CPI data weighs on dollar
    * Sterling crosses $1.38
    * Swedish crown hits 1-month high vs euro
    * Bitcoin down, consolidates recent gains
    * Graphic: World FX rates

 (New throughout, updates prices, market activity and comments, FX table; new byline, changes dateline;
previous LONDON)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, Feb 10 (Reuters) - The dollar dropped to two-week lows on Wednesday in choppy trading, led by
losses against sterling and the euro, weighed down by U.S. data showing tepid inflation and a slippage in
Treasury yields.
    U.S. benchmark 10-year yields were last at 1.136%, down 2 basis points from Monday's level. 
    The dollar extended losses after data showed U.S. underlying inflation remained benign. Excluding the
volatile food and energy components, the CPI was unchanged for a second straight month. Tame
inflation data made it more likely the Federal Reserve would keep interest rates ultra-low.
    "The momentum for the dollar right now has turned a little bit lower," said Erik Nelson, macro
strategist at Wells Fargo in New York.
    "We're not ready to throw in the towel on our view of a short-term bullish trend for the dollar. But our
conviction on that view has lessened a bit. It seems that there has been a perceptible shift toward
    The dollar index drifted to a two-week low of 90.249, and set for a third day of losses. It last
traded 0.2% lower at 90.324.
    Traditionally viewed as a safe-haven, the dollar has sunk against major peers as optimism over monetary
and fiscal support, robust corporate earnings and coronavirus vaccines bolstered risk sentiment.
    Bitcoin, meanwhile, consolidated recent gains on Wednesday, trading 3.7% lower at $44,799. It
hit a new high of $48,216 on Tuesday following Tesla's disclosure of a $1.5 billion investment in the
virtual currency.
    Rival virtual currency ethereum, which often moves in tandem with bitcoin, reached a record $1,839 on
Wednesday before pulling back slightly. It was last down 3.8% at $1,706.
    Sweden's crown strengthened to a one-month high of 10.0406 crowns per euro ahead of the central bank's
interest rate decision, then pared some of those gains after the bank kept monetary policy unchanged as
    Foreign exchange traders have been waging a tug-of-war over the impact on the dollar of U.S. President
Joe Biden's planned $1.9 trillion fiscal stimulus package.
    On one hand, it is expected to speed a U.S. economic recovery, bolstering the currency. But on the
other, it could heat up inflation which would lift riskier assets at the dollar's expense.
    After a strong start to the year for the greenback, the latter view appears to be regaining sway, with
last week's U.S. jobs data providing the turning point, according to Westpac analysts.
    The dollar gained 0.1% against the yen to 104.67 yen. The Japanese currency earlier hit its
highest against the greenback since Jan. 29.
    The euro edged up to $1.2132, adding to a three-day gain and hitting its highest since the
start of February.
    The British pound set fresh three-year highs of $1.3865 and was last up 0.3% at $1.3847.
    Currency bid prices at 10:48AM (1548 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct       High Bid    Low Bid
                                              Previous                   Change                   
 Dollar index                 90.3800        90.4610     -0.08%         0.443%        +90.5280    +90.2490
 Euro/Dollar                  $1.2128        $1.2121     +0.06%         -0.74%        +$1.2144    +$1.2110
 Dollar/Yen                   104.6700       104.5700    +0.07%         +1.31%        +104.8350   +104.4300
 Euro/Yen                     126.95         126.70      +0.20%         +0.02%        +127.0800   +126.6600
 Dollar/Swiss                 0.8905         0.8923      -0.20%         +0.66%        +0.8931     +0.8895
 Sterling/Dollar              $1.3843        $1.3813     +0.23%         +1.34%        +$1.3865    +$1.3803
 Dollar/Canadian              1.2702         1.2692      +0.09%         -0.24%        +1.2710     +1.2669
 Aussie/Dollar                $0.7724        $0.7739     -0.16%         +0.44%        +$0.7756    +$0.7720
 Euro/Swiss                   1.0798         1.0813      -0.14%         -0.06%        +1.0819     +1.0796
 Euro/Sterling                0.8760         0.8769      -0.10%         -1.98%        +0.8780     +0.8752
 NZ                           $0.7204        $0.7240     -0.48%         +0.33%        +$0.7244    +$0.7200
 Dollar/Norway                8.4510         8.4455      -0.12%         -1.77%        +8.4600     +8.4090
 Euro/Norway                  10.2490        10.2358     +0.13%         -2.08%        +10.2565    +10.2070
 Dollar/Sweden                8.3236         8.3157      +0.10%         +1.55%        +8.3333     +8.2794
 Euro/Sweden                  10.0937        10.0840     +0.10%         +0.17%        +10.0995    +10.0430
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Ritvik Carvalho in London; Editing by David