* Fed minutes show no agreement on near-term hike
* No sign Japan investors ready to buy dollar on dips
* Sterling eyes UK retail sales data
By Hideyuki Sano
TOKYO, Aug 18 (Reuters) - The dollar sagged on Thursday after minutes from the Federal Reserve's July meeting showed more policy members opposed a near-term rate hike than supported it.
The minutes showed "several" policymakers said a slowdown in the future pace of hiring would argue against a near-term hike even as members of the rate-setting Federal Open Market Committee were generally upbeat about the U.S. economic outlook. outnumbers "some" board members who anticipated that economic conditions would soon warrant taking another step in reducing policy accommodation.
The minutes disappointed those who had bet that the Fed could be more hawkish after comments from influential New York Fed chief William Dudley on Tuesday that "it's possible" for rates to be hiked at the Sept. 20-21 policy meeting. yen JPY= firmed 0.4 percent to 99.87 yen per dollar, coming within sight of its seven-week peak of 99.55 to the dollar set on Tuesday.
A break there would open the way for a test of its 2 1/2 year high of 99.00 to the dollar touched on June 24 in the wake of Britain's EU referendum results.
Another disappointment for dollar bulls was the lack of dollar buying by Japanese institutional investors, a trader at a North American bank said.
"People had been speculating that Japanese investors could remove currency hedging on their foreign bond investment because of recent rise in hedging costs and the yen has risen considerably. But there is no sign of such moves at all," the trader said.
The euro EUR= traded at $1.1301, near Tuesday's seven-week high of $1.1323.
The dollar's index against a basket of six major currencies .DXY =USD last stood at 94.63, hovering near Tuesday's seven-week low of 94.426 and having lost 1.1 percent so far this week.
The dollar also weakened against the British pound GBP=D4 , which was threatening earlier this week to test the three-decade low it hit last month on worries UK data this week could provide the first proof of economic damage from the Brexit vote.
Data published so far, however, shows limited tangible fallout from Brexit, with jobless claims unexpectedly falling in July.
Still, that has not changed market perception that the Bank of England will need to ease policy further to support the economy, keeping pressure on sterling.
The pound fetched $1.3050, after momentarily falling to as low as $1.2850 from what appeared to be a "fat finger" trading mistake.
Earlier this week it edged close to its July trough of $1.2798.
UK retail sales data due at 0830 GMT is expected to show a 0.2 percent rise in July after a sharp fall in June. ECONGB