* Dollar steady after 8 straight days of losses v yen
* Uncertainty over Trump administration reforms
* ECB tightening expectations underpin euro (New throughout, updates prices and market activity to U.S. market open; new byline, changes dateline, previous LONDON)
By Saqib Iqbal Ahmed
NEW YORK, March 24 (Reuters) - The dollar steadied near a four-month low against the yen on Friday, ahead of a vote in Washington on new healthcare legislation that some investors view as a litmus test of whether U.S. President Donald Trump will be able to pass fiscal stimulus.
Republican lawmakers have struggled to overcome differences over the legislation after Trump walked away from negotiations, telling them to pass the bill on Friday or keep Obamacare in place. The vote, which had originally been set for Thursday, was postponed because of the tepid support.
"It's just really coming down to what happens in Congress," said Mazen Issa, senior FX strategist at TD Securities in New York.
With a risk-averse mood having taken hold across markets this week on doubts over Trump's ability to deliver fiscal and economic reforms, the greenback has slipped 1.4 percent against the yen.. On Friday, the dollar was up 0.14 percent at 111.08 yen.
Investors were split on whether a potential defeat for Trump would knock the dollar and stock markets - because it would be seen as symptomatic of his inability to get reforms through Congress - or whether it would boost them, as he would then be able to move straight onto tax reforms.
"If healthcare does not pass I don’t think it's USD negative," Brad Bechtel, managing director at Jefferies in New York, said in a note.
While there will be a knee-jerk reaction if the bill does not pass, it will not change the underlying economic picture, he said.
"With a Fed that is in tightening mode and U.S. yields that are perky, along with a looming balance sheet reduction program that is being talked about and is probably not all that far away from implementation, we are not in a USD negative environment."
The dollar index, which measures the greenback against a basket of six major currencies, was little changed at 99.732.
The euro gained 0.2 percent to $1.0813, close to a seven-week peak of $1.0825 touched on Wednesday on the view that the European Central Bank is heading towards tightening monetary policy amid accelerating growth and inflation rates across the euro zone.
Sterling fell against the dollar and euro, retreating from the previous session's one-month highs, as investors braced for Britain's beginning the formal process of leaving the European Union next week.
Reporting by Saqib Iqbal Ahmed; Editing by Frances Kerry