(Updated at 3:01 p.m. ET/1901 GMT)

By Chuck Mikolajczak

NEW YORK, July 19 (Reuters) - The dollar climbed on

Friday and was set to snap a two-week streak of declines as a

worldwide cyber outage that affected banks, airlines and

broadcasters unnerved investors, although volatility in the

currency markets was largely contained.

A software update by global cybersecurity firm CrowdStrike ( CRWD )

crippled industries from travel to finance before

services started coming back online after hours of disruption,

highlighting the risks of a global shift towards digital,

interconnected technologies.

The dollar index was on track for its second straight daily

advance, its first in two weeks, to put the greenback on pace

for its first weekly gain in three, bouncing back on recent U.S.

economic data and concerns about the technology outage.

"It's perhaps a result of the selling pressure earlier in

the week, and at the tail end of last week, seeming rather

over-done, particularly when one considers that U.S. economic

growth remains firm, and that while the Fed are set to cut in

September, easing will still be relatively synchronized across

G10 central banks," said Michael Brown, market analyst at

Pepperstone in London.

"Of course, the earlier tech issues may have sparked a bit

of a flight to safety too, causing some knee-jerk dollar buying

earlier in the day, with that strength then continuing into the

afternoon session."

The dollar index, which measures the greenback

against a basket of currencies, gained 0.24% at 104.39 and was

up 0.3% on the week.

The Federal Reserve is scheduled for its next policy

announcement at the end of July. Markets expect only a slight

chance for a cut of at least 25 basis points (bps), while almost

completely pricing in a cut at its September meeting, according

to CME's FedWatch Tool.

The yen, however, was up for the week against the greenback

after suspected official buying last week from Japanese

authorities, and another suspected intervention from the Bank of

Japan (BOJ) earlier this week.

Against the yen, the dollar strengthened 0.07% at

157.48 on the session, oscillating between gains and losses on

the session after data showed inflation in Japan picked up for a

second month. The greenback was off 0.24% on the week against

the Japanese currency.

The yen has fallen more than 10% against the dollar this

year, largely due to the wide difference in interest rates

between the U.S. and Japan, and hit 38-year lows at the

beginning of the month, spurring action from Tokyo.

The euro was down 0.16% at $1.0878 and set to snap a

two-week win streak, a day after the European Central Bank kept

rates steady, as was widely expected and gave no insight into

its next move.

Sterling weakened 0.25% at $1.2909, retreating

further from a one-year high hit earlier this week, after data

showed UK retail sales fell more than expected in June, as

cooler weather deterred shoppers. For the week, the pound is off

0.6% and set to snap a three-week streak of gains.

In cryptocurrencies, bitcoin gained 4.86% at

$66,924.00. Ethereum rose 2.79% at $3,508.90.