* Moderate U.S. inflation data pressures U.S. Treasury yields
* Greenback underpinned by expectations Fed still poised to hike
TOKYO, Nov 17 (Reuters) - The dollar caught its breath in early Asian trading on Thursday, after charging to a 14-year high against a basket of currencies on bets the Trump administration will adopt inflationary policies.
The dollar index, which tracks the greenback against six major rival currencies, retreated 0.2 percent to 100.260 .DXY , after climbing as high as 100.57 on Wednesday, its loftiest peak since April 2003.
The dollar also slipped 0.2 percent against the yen to 108.86 yen JPY= after notching a high of 109.76 overnight, its highest since June 1. JPY=
"It seems that U.S. rates aren't rising as fast as they have the past week, so it seems the dollar's strength and the rise of U.S. rates are taking a pause," said Masafumi Yamamoto, chief forex strategist at Mizuho Securities in Tokyo.
"Japanese rates are also rising, so this is shrinking the gap between U.S. and Japanese rates, especially the two-year tenor," he said. "So as long as the BOJ doesn't show any strong intention to cap the rise of the Japanese yield curve, or if it is actually flattening, then this will cause further downward pressure on the dollar/yen."
On Wednesday, the yield on two-year Japanese government bonds, while still in negative territory, rose to minus 0.095 percent JP2YTN=JBTC , its highest level since early February.
On the U.S. data front on Wednesday, U.S. manufacturing output increased for a second straight month in October, while the Labor Department said its producer price index for final demand was unchanged last month as a rise in the cost of goods was offset by declining services costs. moderation in inflation drove a flattening of the U.S. Treasury yield curve, after yields on notes with maturities from 2 to 7 years rose to their highest since early January. US/
The euro added 0.1 percent to $1.07045 EUR= after dipping below $1.07 overnight for the first time in nearly a year.
The euro could hit parity against the dollar next year, as Europe contends with political uncertainty and a weak economic recovery, Philip Saunders, Investec's co-head of multi-asset growth, told the Reuters Global Investment Outlook Summit on Wednesday. dollar remained underpinned by expectations that the U.S. Federal Reserve is on track to hike interest rates this year, and might have to take further action next year as well.
Philadelphia Federal Reserve President Patrick Harker said he favoured raising interest rates and that the U.S. central bank might have to hike more aggressively if the incoming Trump administration enacts a fiscal stimulus.