* Dollar hits six-month high against Japanese yen
* Little immediate reaction to China June trade data
* Pound remains fragile, brushes 10-day trough (Updates throughout)
By Daniel Leussink and Shinichi Saoshiro
TOKYO, July 13 (Reuters) - The dollar was buoyant near a 10-day peak on Friday, supported by Treasury yields that edged higher on expectations the U.S. inflation rate will rise.
Short to long-term U.S. Treasury yields rose after U.S. consumer prices data on Thursday showed a steady buildup of inflation pressure that could allow the Federal Reserve to hike interest rates as many as four times in 2018.
The dollar index against a basket of six major currencies nudged up 0.1 percent to 94.875 and was close to 94.941, the 10-day peak scaled a day earlier.
The index has risen 0.9 percent on the week.
“The dollar has benefited this week from the trade conflict concerns that emerged earlier, which ended up funnelling safe-haven bids into the currency,” said Koji Fukaya, president of FPG Securities in Tokyo.
“On top of that, the U.S. economy has shown it is doing well and Treasury yields have risen, and these factors are all helping the dollar.”
Working in favour of the greenback, emerging market and commodity-linked currencies took hits this week after the United States threatened to impose tariffs on more Chinese goods, escalating the trade war between the world’s two biggest economies.
The dollar this week has strengthened significantly against the Japanese yen, which normally is bought as a safe haven in times of political tension and market turmoil.
On Friday, the U.S. currency hit a fresh six-month high of 112.775 yen and last traded at 112.66. The dollar has advanced roughly 2 percent versus its Japanese peer this week, the biggest weekly gain since mid-September.
As the dollar held firm, the euro remained sluggish, standing little changed at $1.1662, having pulled away from a 3-1/2 week high of $1.17905 touched on Monday. The single currency was on track for a loss of 0.6 percent this week.
The Australian dollar was a shade higher at $0.7413 . The currency has had a turbulent week, sinking more than 1 percent midweek on U.S.-China trade woes before steadying as risk aversion ebbed in the broader markets.
The Aussie, considered a proxy of China-related trades, showed little reaction to data on Friday showing China’s dollar-denominated exports rose a higher-than-expected 11.3 percent in June from a year earlier.
The British pound remained weak, falling as much as 0.2 percent to $1.317, its lowest level since July 3, as investors remained on edge about the resignation of two key eurosceptic ministers.
Sterling has lost 0.85 percent this week.
“The instability of the British government is the main reason for the pound’s weakness. Two ministers stepped down, raising the prospect of a ‘hard Brexit’ and putting pressure on the pound,” said Yukio Ishizuki, senior currency strategist at Daiwa Securities.
“Given the discontent and grumbling within the conservative party, the position of (Prime Minister Theresa) May is becoming precarious,” he said. (Editing by Sam Holmes and Richard Borsuk)