FOREX-Upbeat April US housing data cheers dollar

(Recasts, updates prices, changes byline, dateline, previous LONDON)

* Dollar recoups some losses versus euro on housing data

* U.S. housing starts rise unexpectedly in April

* Data reinforces views the Federal Reserve is on pause

By Lucia Mutikani

NEW YORK, May 16 (Reuters) - The dollar rose versus the yen and recouped some losses against the euro on Friday after unexpectedly upbeat April U.S. housing data helped to slightly brighten up the economic picture.

News that construction starts on new U.S. homes rose, while applications for new building permits turned up for the first time in five months, reinforced market perceptions the Federal Reserve would probably not need to cut interest rates next month.

"It's a nice upside surprise and it is certainly a positive figure following yesterday's disappointing U.S. data," said Joe Manimbo, currency trader, Ruesch International in Washington. "Certainly it is the type of data that will back the view that U.S. interest rates have bottomed, supporting the dollar."

The euro last traded up 0.1 percent at $1.5463 <EUR=>, after rising to as high as $1.5522 in overnight trade. The dollar rose 0.3 percent to 104.97 yen <JPY=> having earlier fallen to 104.16.