* Dollar index pulls away from 4-1/2-month lows
* Fed speakers remind markets of rate hike plans
* Sterling braces for formal filing of Brexit launch
TOKYO, March 29 The dollar pulled away from
4-1/2-month lows against a currency basket on Wednesday as solid
data backed expectations for more U.S. interest rate hikes this
year, while sterling was knocked by concern about Britain's
impending exit from the European Union.
The dollar index, which tracks the greenback against six
major rival currencies, edged up 0.1 percent to 99.754,
It moved off a low of 98.858 plumbed earlier this week, its
weakest level since Nov. 11, in the wake of U.S. President
Donald Trump's failed healthcare reform bill.
The healthcare stumble raised doubts that Trump would be
able to carry out his fiscal stimulus and tax cuts, and
pressured the dollar to 110.11 yen, its lowest since Nov.
18. It last stood at 111.17 yen, up slightly on the day.
"I think the optimism about 'Trumponomics,' against the
failure to pass the Obamacare reform bill, is still dominating
the dollar/yen market," said Masafumi Yamamoto, chief forex
strategist at Mizuho Securities in Tokyo.
"The dollar has been quite resilient, and this shows that
optimism and hope among market participants remains, that some
things will happen under the Trump administration," Yamamoto
U.S. Federal Reserve Vice Chairman Stanley Fischer also gave
the dollar a lift as he said in a television interview that two
more increases to U.S. overnight interest rates this year seemed
The Fed raised rates in March, and a majority of the central
bank's policymakers foresee at least two more increases this
Fed Governor Jerome Powell said on Tuesday that the collapse
of the healthcare overhaul efforts had made the U.S. central
bank's job harder as it tries to anticipate which set of
policies would pass.
Reinforcing rate hike expectations, the Conference Board
said the U.S. consumer confidence index hit 125.6 in March,
surpassing expectations for a reading of 114 and much higher
than 116.1 in February. The March level marked the highest since
Sterling wallowed at one-week lows, down 0.4 percent at
$1.2403 as investors braced for British Prime Minister
Theresa May's move later on Wednesday to formally file paperwork
to leave the European Union.
Investors were also assessing news that Scotland's
parliament had backed a vote for independence but that the
British government would not enter independence negotiations.
Further weighing on the pound, Bank of England interest
rate-setter Ian McCafferty highlighted a weak outlook for the
economy on Tuesday, and said he did not know if he would vote to
increase borrowing costs at the next BoE meeting in May.
The euro was steady on the day at $1.0814.
(Reporting by Tokyo markets team; Editing by Shri Navaratnam)