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Dissolve yeast in half of the fresh milk. Set aside to activate yeast.
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In a mixer bowl, pour in the remaining milk, egg, butter and sugar. Mix wet ingredients together.
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Add in half of the flour. Mix until combined. Add in milk with active yeast.
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Add in remaining flour.
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Knead using a mixer fitted with a dough hook attachment for 15-20 minutes, or knead by hand for about 20-30 minutes.
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Once dough is smooth and elastic, form into a ball. Place in a greased bowl and cover with plastic wrap.
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Let the dough ferment until it doubles in size about 20-30 minutes.
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Punch down dough to remove air pockets. Portion dough around 50g per piece then form into balls.
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Flatten a piece of dough then place one slice of cheese in the middle and roll lengthwise. Pinch the seams together to seal.
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Fry dough in preheated oil, until golden brown.
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Mix together equal parts powdered milk and powdered sugar in a tray. Roll fried donuts in sugar-milk mixture to coat.
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Best served warm