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FOREX-Dollar rises as higher U.S. yields support

* U.S. 10-year Treasury yields rise to one-week high

* Sterling slips to 6-day low after UK wages data (Adds U.S. market open; changes dateline; previous LONDON)

NEW YORK, Oct 18 (Reuters) - The dollar rose against a basket of currencies on Wednesday, on pace for a fifth-straight day of gains, taking support from higher U.S. Treasury yields.

The dollar index, which tracks the greenback against six major currencies, was up 0.13 percent at 93.609. The greenback was 0.67 percent higher against the Japanese yen at 112.94 yen.

"It's all about the yields this week, so far," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.

"The dollar has drawn support from the broad move higher across the curve in U.S. bonds."

Benchmark 10-year U.S. Treasury yields hit a six-day high and 30-year bond yields hit a five-day high.

Short-dated notes added to selling after comments from New York Fed President William Dudley, who sounded supportive of Fed Chair Janet Yellen's comments over the weekend that the central bank was likely to continue its path of U.S. interest rate increases.

The spread between U.S. 2-year government debt and its German counterpart rose to its highest level since 2000.

The outlook for continued policy normalization by the Fed and chatter about U.S. President Donald Trump possibly nominating a less dovish replacement for Yellen as Fed Chair when her term expires in February, have helped boost yields, Esiner said.

Trump has interviewed several top prospects for the post of Fed chair and faces a choice between two continuity candidates, Yellen and Governor Jerome Powell, and a clutch of outsiders, including Gary Cohn, currently his top economic advisor, former Fed Governor Kevin Warsh, and Stanford University economics professor John Taylor.

"There are also nascent hopes that lawmakers in Washington are inching closer to a deal on taxes," Esiner said.

Senate Republicans worked on Tuesday to ensure support for a budget resolution vital to President Trump's drive to overhaul the U.S. tax code.

The dollar lost some steam on Wednesday after data showed U.S. homebuilding fell to a one-year low in September as Hurricanes Harvey and Irma disrupted the construction of single-family homes in the South.

Investors will also focus on U.S. Beige Book data later in the day, with some likely to be wary of buying dollars aggressively after disappointing U.S. inflation data.

Meanwhile, sterling dipped to a six-day low after data showed British wage growth was still lagging well behind inflation. The pound was down 0.14 at $1.3171.

(Reporting by Saqib Iqbal Ahmed; Editing by Chizu Nomiyama)