Feb 5 (Reuters) - The U.S. dollar index slumped with Treasury yields on Wednesday following Fed comments and a report that suggests the U.S. services sector may be losing steam at the same time inflation pressures are cooling, potentially opening the door for more rate cuts. ISM’s non-manufacturing PMI slipped 1.3 points to 52.8, with the new orders and prices paid subindices both falling.

A sharply wider trade deficit in December appeared to be the result of restocking before U.S. tariffs were implemented. The ADP report on employment growth for January beat estimates, showing 183,000 jobs were added versus 150K expected. This comes before the U.S. non-farm payrolls report on Friday. Richmond Fed President Tom Barkin said he expects annual inflation rate figures will come down and that the central bank is still leaning toward rate cuts this year. He adds that there is uncertainty about the impact of new Trump administration initiatives on things like tariffs, immigration and regulations.

EUR/USD rose for a second day as the dollar was pressured and euro shorts covered. The pair was trading in the top half of its 21-day Bollinger range though has yet to retake the 1.05 level amid lingering concerns about possible U.S. tariffs and soft growth in the region. Expiries at 1.0400 may offer nearby support.

European Central Bank Chief Economist Philip Lane suggested slowly easing policy to balance growth and inflation risks.

USD/JPY was actively sold following the weak US ISM report, adding to short positions established earlier on Wednesday following robust Japanese wage data and corporate earnings. The pair fell below its 200-DMA and 100-DMA at 152.73-80 and its cloud bottom at 153.37, finding support near 152. Yen option demand suggests weakness may persist into U.S. jobs data Friday. A 38.2% Fibonacci level at 151.50 offers support below 152.

GBP/USD rose 0.2% ahead of an expected rate cut at Thursday's Bank of England policy meeting.

Treasury yields fell 5 to 12 basis points as the curve flattened. The 2s-10s curve fell about 6 basis points to +23.8bp.

The S&P 500 rose 0.15% in a mixed market due to earnings.

Gold rose 0.8%, touching a fresh record amid tariff concerns.

Oil fell 2% after a report of a large U.S. stockpile build. Heading toward the close: EUR/USD +0.37%, USD/JPY -1.26%, GBP/USD +0.25%, AUD/USD +0.54%, =USD -0.5%, EUR/JPY -0.91%, GBP/JPY -1.03%, AUD/JPY -0.73%.(Editing by Burton Frierson Reporting by Robert Fullem)