By Kevin Buckland

TOKYO, Aug 15 (Reuters) -Asian stocks were firm on Thursday while the dollar remained on the back foot amid lower U.S. Treasury yields after benign consumer inflation data overnight reinforced bets for the Federal Reserve to start cutting interest rates next month.

Regional equities took their lead from gains on Wall Street, with Japan's Nikkei .N225 rising 0.5% as of 0139 GMT and Australia's stock benchmark .AXJO up 0.1%.

Mainland Chinese blue chips .CSI300 added 0.4%, although Hong Kong's Hang Seng .HSI slipped 0.3%.

U.S. S&P 500 futures EScv1 pointed 0.1% higher after the cash index advanced 0.4% on Wednesday, buoyed by the slowest rise in the consumer price index in more than three years.

The dollar remained weak after slumping overnight to its lowest level to the euro since the end of last year. The single currency EUR=EBS traded flat at $1.1009 after reaching $1.10475 in the previous session.

The 10-year Treasury yield US10YT=RR ticked up slightly to 3.84% in Asian hours, after dipping to as low as 3.811% on Wednesday.

Traders remain convinced that the Fed will reduce rates on Sept. 18 for the first time in 4-1/2 years, but are split on whether policy makers will opt for a super-sized 50 basis-point reduction. While inflation is slowing, signs it may remain sticky spurred a reduction of bets on a larger cut to 37.5% from about 50% a day earlier. FEDWATCH

A major macroeconomic test looms later on Thursday with the release of U.S. retail sales figures.

"If we were to see a negative retail control sales number, it would likely set alarm bells ringing, given the market's recent concerns about a recession in the U.S.," said Tony Sycamore, a market analyst at IG.

The dollar was stable at 147.35 yen JPY=EBS as the pair continued its week-long consolidation around the 147 mark.

Sterling remained depressed after soft UK inflation figures hinted at faster, deeper Bank of England rate cuts. The currency was flat at $1.2824 after sagging 0.3% on Wednesday.

The Australian dollar AUD=D3 was at $0.6600, erasing early losses to be slightly higher following a choppy reaction to an increase in employment.

Gold XAU= edged up 0.1% to $2,449.60 per ounce after Wednesday's 0.7% dive.

Oil prices rose on Thursday, recovering some of the previous day's loss, on hopes that potential Fed rate cuts would boost demand.

Brent crude futures LCOc1 added 0.2% to $79.93 a barrel, and U.S. West Texas Intermediate crude CLc1 increased 0.3% to $77.21.

Both benchmarks fell more than 1% on Wednesday after an unexpected rise in U.S. crude inventories.

Reporting by Kevin Buckland; Editing by Christian Schmollinger

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