* Sterling soft ahead of inflation data * Hovers near 2-week low vs euro, flat vs dollar * Sticky inflation could lift sterling LONDON, May 22 (Reuters) - Sterling hovered near a two-week low against the euro on Tuesday and was subdued versus the dollar, with investors wary about the UK currency ahead of inflation data that may revive talk of more easing by the Bank of England. The common currency inched up to trade at 80.835 pence, not far from a two-week high of 80.985 pence struck on Monday with traders citing decent offers above 81.00 pence and then more above 81.30 pence. Against the dollar, sterling was flat on the day at $1.5835, with an Asian central bank cited as a seller early in the London session. Stop-loss orders are cited above $1.5850 and a move above that could see the pound rise to $1.5900. "It all depends where CPI comes in at," said a London-based spot trader. "If it is higher than expected we could break past $1.5840/50 and squeeze a few stops. But $1.5900 should provide a stern test of bulls' resolve as there are some good offers up there." Softer-than-expected inflation data could see sterling dip towards $1.5800, with near-term support around $1.5730 - the low struck on May 18. April inflation numbers are due at 0830 GMT and consumer prices are forecast to rise 3.1 percent from a year ago, slowing from 3.5 percent in March. Retail prices are expected to be much stickier and are forecast to rise 3.5 percent in April compared to 3.6 percent in March. A softer-than-expected inflation reading could revive talk of more asset purchases by the Bank of England especially since the crisis in the euro zone, Britain's biggest trading partner, has worsened in the past few weeks. More quantitative easing is considered negative for the currency. Stubborn inflation pressures, however, would make the Bank of England's job of easing monetary policy much harder and could lend support to the pound. The UK currency has been a key beneficiary from investors fleeing the turmoil in the euro zone. A Bank of England inflation report last week warned of the risk to UK growth from the euro zone crisis and left the door open for another round of asset purchases. BoE policymaker Adam Posen said late last week that he may have been premature in dropping his call for additional stimulus last month, because the underlying economy may be weaker than he thought earlier this year. Posen dropping his call for asset buying gave a huge boost to the pound. Details on how policymakers voted at the latest monetary policy committee meeting held earlier this month will be revealed on Wednesday. "If prices do fall as much, or more than predicted, then we can expect the usual speculation about further stimulus measures in June, which is likely to weaken sterling further," Michael Hewson, senior market analyst at CMC wrote in a note. If the numbers were more resilient, then the debate over more QE would be split, he added.

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