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FOREX-Dollar edges up as stocks rally, inflation data eyed

* Euro, dollar little changed to kick off trading week

* Sterling rises ahead of Johnson leadership vote

* ECB statement, U.S. inflation data due later in the week (Adds details, updates prices; changes byline, dateline; previous LONDON)

By Chuck Mikolajczak

NEW YORK, June 6 (Reuters) - The dollar advanced modestly on Monday as a boost in risk appetite sent U.S. equities higher and kept gains on the safe haven in check ahead of a key reading on inflation later in the week.

After touching a near twenty-year high of 105.01 on May 13, the dollar has eased back to around the 102 level, although Friday's strong payrolls report helped the dollar notch its first weekly gain in three.

Ahead of the Federal Reserve's policy announcement on June 15, in which the central bank is widely expected to raise rates by 50 basis points, investors will look to Friday's reading on consumer prices for signs of how long the Fed may continue its rate hike path.

U.S. stocks rallied on Monday, with the S&P 500 and Nasdaq up more than 1% in part due to strong gains in growth stocks.

"For one, risk appetite is setting the market tone ahead of this week’s big events, and the big events on the docket this week are really going to shape expectations for central bank policy through the end of the year," said Joe Manimbo, senior market analyst at Western Union Business Solutions, in Washington DC.

"The market is still scratching its head over September, the market has certainly discounted a rate hike next week and in July too but September - consumer prices this week, certainly the Fed next week and even Jackson Hole if you want to look a couple of months out - those are going to be the key events that give us a clearer picture of whether or not the Fed hits the pause button in September."

The dollar index rose 0.098% at 102.190, with the euro down 0.12% to $1.0706 ahead of a European Central Bank (ECB) policy meeting later this week.

BofA Securities now expects the ECB to raise interest rates by 150 basis points this year including 50 bps moves in July and September, it said in a note on Monday, along with a more hawkish view of the central bank's rate hike path by Barclays.

The Japanese yen weakened 0.35% versus the greenback at 131.32 per dollar, while Sterling was last trading at $1.2547, up 0.47% on the day.

Sterling gained ground ahead of a confidence vote on Monday after a growing number of lawmakers in his Conservative Party questioned the British leader's authority over what has been dubbed the "partygate" scandal.

Bank of Japan Governor Haruhiko Kuroda said on Monday the central bank's top priority was to support the economy, stressing an unwavering commitment to maintaining "powerful" monetary stimulus.

The Australian dollar rose 0.08% versus the greenback at $0.721 ahead of a policy meeting by the Reserve Bank of Australia on Tuesday.

(Reporting by Chuck Mikolajczak Editing by Nick Zieminski)