(Updates prices at 0330 GMT)

By Rae Wee

SINGAPORE, July 12 (Reuters) - The yen swung between

losses and gains on Friday in volatile trade, reflecting

investors' skittishness after Tokyo was thought to have

intervened to prop up the Japanese currency in the wake of a

cooler-than-expected U.S. inflation report.

Moves in the yen against the dollar and other major

currencies stole the spotlight on Friday, though in the broader

market, Asian stocks were headed for a weekly gain on growing

bets for a September rate cut from the Federal Reserve.

The dollar was last 0.23% higher at 159.24 yen,

after rising more than 0.3% to an intraday high of 159.45 yen

and falling 0.7% to a low of 157.75 yen in early trading on

Friday.

Moves were similarly choppy in the other yen crosses, with

the euro and sterling each last up 0.25%

against the yen, both reversing earlier losses against the

Japanese currency.

"It's either one of two things - the market's either jumping

at shadows this morning waiting for a second round of

intervention, and I think now that the (Bank of Japan) has

committed again, there's good reason for them to come back,"

said Tony Sycamore, a market analyst at IG.

"The second thought is the market's just really skittish."

Speculation is rife that Japanese authorities had likely

intervened in the currency market to shore up the yen on

Thursday, after it surged nearly 3% against the dollar at one

point after the release of the U.S. inflation figures.

The dollar ended Thursday's session with a 1.7% loss against

the yen, its largest daily decline since May.

Local media attributed the move to a round of official

buying from Tokyo to prop up a currency that has languished at

38-year lows, though authorities as usual remained reticent on

providing any hints of an intervention.

The Nikkei newspaper reported that the BOJ conducted rate

checks with banks on the euro against the yen on Friday, citing

several sources.

ON TRACK

MSCI's broadest index of Asia-Pacific shares outside Japan

fell 0.11%, tracking a negative lead from Wall

Street, after investors rotated into smaller companies following

the U.S. inflation print.

"The broad move was driven by rotation and switching across

styles and factors," said Chris Weston, head of research at

Pepperstone. "It was the well-loved names that saw the selling

and maybe this was partly technical given just how extended

these plays are."

The move spilled over to some Asian bourses on Friday,

with Japan's Nikkei falling 2%, similarly dragged down

by tech stocks. However, Hong Kong's Hang Seng Index rose

2%.

S&P 500 futures were flat, while Nasdaq futures

fell 0.1% and EUROSTOXX 50 futures eased 0.06%.

Still, Asia shares remained on track for

a weekly gain of about 1.5%, helped by growing bets of imminent

U.S. rate cuts.

Those expectations were reinforced after Thursday's U.S.

consumer price figures and as Fed officials showed increasing

confidence that inflation was coming to heel.

Market pricing now shows an over 90% chance of a Fed easing

cycle beginning in September, as compared to just over a 50%

chance a month ago, according to the CME FedWatch tool.

"While the timing of eventual Fed rate cuts will depend on

incoming data, this report, together with some softening in the

labor market, has further tilted the balance of evidence towards

an earlier start time," said David Doyle, head of economics at

Macquarie.

In China, data on Friday showed exports rose 8.6% in June

from a year earlier, though imports unexpectedly shrank 2.3%.

Markets hardly reacted to the figures, with Chinese blue

chips last down 0.2%.

The onshore yuan dipped slightly to 7.2640

per dollar.

In other currencies, sterling eased 0.04% to

$1.29075, though hovered near a roughly one-year high hit on

Thursday, as comments from Bank of England policymakers and

better-than-forecast GDP data led traders to reduce bets on an

August rate cut in Britain.

The euro gained 0.03% to $1.0869, while the U.S.

dollar was on the defensive and languished near a one-month low

against a basket of currencies from the previous session.

Oil prices meanwhile rose as signs of strong summer demand

and easing inflationary pressures in the United States bolstered

investor confidence.

Brent futures ticked up 0.25% to $85.62 per barrel,

while U.S. West Texas Intermediate (WTI) crude gained

0.39% to $82.94 a barrel.

Gold edged 0.26% lower to $2,408.69 an ounce.

(Editing by Christian Schmollinger)