* Fed's Powell says "significant progress" made on inflation
* U.S. job openings rise in May -JOLTS report
* ECB's Lagarde says euro zone is advanced on disinflation path
    

  
 (Recasts, adds new comment, Fed's Powell comments, JOLTS data,                 
              bullets, byline, New York dateline, FX table; updates prices)

By Gertrude Chavez-Dreyfuss and Stefano Rebaudo
       NEW YORK/MILAN, July 2 (Reuters) - The dollar slipped on Tuesday in
choppy trading after Federal Chair Jerome Powell struck a slightly dovish tone
in his comments, suggesting that the U.S. central bank is more than likely to
start its easing cycle later this year.
    Powell, in a monetary policy conference in Portugal, said the U.S. economy
has made significant progress on inflation as it gets back on the
disinflationary path. His remarks were viewed as dovish, analysts said.
    "Fed chair Jerome Powell let his dovish plumage show. In our view, he put a
September rate cut firmly on the table by acknowledging 'significant progress'
in bringing inflation down, and pointing to the 'two-sided risks' facing
policymakers as labour markets begin to cool," said Karl Schamotta, chief market
strategist at Corpay in Toronto.
    "This is triggering an unwind in the surge in short-end yields that took
place after last week's presidential debate, and is forcing an altitude
adjustment in the dollar." 
    Powell's comments offset data showing U.S. job openings increased in May
after posting outsized declines in the prior two months. Job openings, a measure
of labor demand, rose 221,000 to 8.140 million on the last day of May, according
to the Job Openings and Labor Turnover Survey or JOLTS report. 
    Economists polled by Reuters had forecast 7.910 million job openings in May.
Unfilled positions peaked at a record 12.182 million in March 2022.
    Following the JOLTS report and Powell's comments, U.S. rate futures have
priced in a 69% percent chance of a rate cut in September, up from about 63% on
Monday, according to LSEG calculations. The market has also priced in between
one to two rates cut in 2024.
    In late morning trading, the dollar index, which measures the U.S.
unit against six other currencies, was down 0.1% at 105.74.
    The dollar has been recently supported overall by the persistent rise in
Treasury yields.
    
    OVERALL BOOST FROM TREASURY YIELDS
    Benchmark 10-year Treasury yields rose nearly 14 basis points to
4.479% overnight, with analysts linking the rise to expectations that Donald
Trump will win the U.S. presidency, in turn leading to higher tariffs and
government borrowing.
    On Tuesday, the yield on the 10-year note was down 4.3 bps at 4.435%.
    Against the yen, the greenback was slightly down at 161.43. It hit
161.745 per dollar on Tuesday, its strongest level in nearly 38 years, driven
mainly by a wide gap in interest rates between the U.S. and Japan.
    Japan's finance minister said on Tuesday authorities were vigilant to sharp
currency market moves, but stopped short of giving a clear intervention warning.
    Against the euro, the yen touched a lifetime low of 173.67 on
Monday and was just shy of that level on Tuesday, while against the Australian
dollar, the yen was near its lowest in 33 years as carry trade
remained attractive.
    The euro was flat against the dollar at $1.0739, showing little
reaction to comments on Tuesday from European Central Bank President Christine
Lagarde, who was in the same monetary policy forum with Powell. She said the
euro zone is "very advanced" on the disinflationary path but there remain
"question marks" hanging over the outlook for economic growth. 
    Euro zone inflation eased last month but a crucial services component
remained stubbornly high, fuelling concern that domestic price pressures could
stay at elevated levels. 
    Lagarde said on Monday the central bank needs more time to conclude that
inflation is firmly on a path to 2% and benign economic developments indicate
that rate cuts are not urgent. 
    The market is now looking to the second round of French elections during the
weekend.
    In other currencies, sterling rose 0.2% against the dollar to $1.2677
, but not far from the roughly two-month low it hit last week.
    The Aussie dollar was down slightly at US$0.6657, with traders
weighing central bank minutes, which showed much discussion about whether policy
was tight enough to ensure inflation would slow as desired.
    
    
 Currency                                                          
 bid                                                              
 prices at                                                        
 2 July                                                          
 03:24                                                            
 p.m. GMT                                                         
 Descripti  RIC    Last      U.S.       Pct     YTD Pct  High     Low
 on                          Close      Change           Bid      Bid
                             Previous                             
                             Session                              
 Dollar     <=USD  105.78    105.84     -0.05%  4.35%    106.05   105.
 index      >                                                     71
 Euro/Doll                                                    71
 Dollar/Ye                                                     295
 Euro/Yen                                                     09
 Dollar/Sw                                                    28
 Sterling/                                                     71
 Dollar/Ca                                                     9
 Aussie/Do                                                     634
 Euro/Swis                                                    82
 Euro/Ster                                                    68
 NZ                                                            48
 llar                                                             
 Dollar/No                                                       506
 Euro/Norw                                                    295
 Dollar/Sw                                                       07
 Euro/Swed                                                    873
    

    
 (Reporting by Gertrude Chavez-Dreyfuss in New York and Stefano Rebaudo in
Milan; Additional reporting by Amanda Cooper in London, Tom Westbrook and Ankur
Banerjee in Singapore; Editing by Bernadette Baum and David Holmes)