* Dollar/yen rises as investors reverse bets on Japan currency
* Upbeat US consumer confidence data helps lift dollar
* US ADP employment report, Chicago PMI awaited for more cues (Updates throughout)
By Shinichi Saoshiro
TOKYO, Aug 31 (Reuters) - The dollar rose to a one-month high against the yen on Wednesday as investors reversed the bets they had made on speculation that the U.S. Federal Reserve would not hike interest rates anytime soon.
That reversal saw the dollar, which was at around 100.500 yen at the start of the week, extend an overnight rally as far as 103.230 yen JPY= , its highest since July 29.
Dogged by rate hike uncertainty, the dollar dropped to as low as 99.550 yen in mid-August and came within sight of 99.000 yen -- a 2-1/2-year low struck in June against the safe-haven Japanese currency after the Brexit vote.
The euro EUR= was little changed at $1.1153, hovering near a three-week low of $1.1133 plumbed on Tuesday. The common currency was poised to lose 0.2 percent on the month.
The greenback has been on a bullish footing since Friday's comments by Fed Chair Janet Yellen revived expectations the central bank could hike rates as early as September.
Upbeat data released on Tuesday helped the dollar extend gains, with the Conference Board saying its consumer confidence index rose to an 11-month high in August. Other data showed that U.S. house price growth moderated in June but was still strong. ECONUS
"Despite much previous excitement over the yen's potential strength, it failed to convincingly crack the 100 yen (per dollar) mark. This, combined with the latest Fed rate hike views, is prompting participants to square some of their yen longs," said Masashi Murata, senior forex strategist at Brown Brothers Harriman in Tokyo.
"While the positive surprise from the U.S. consumer confidence data helped, the dollar's strength goes beyond fundamental factors," Murata said.
Yen bulls were also kept in check after Japan's Chief Cabinet Secretary Yoshihide Suga told Reuters on Tuesday that the government will respond "appropriately" to unwelcome yen gains. believe the reversal of yen longs could continue for a while, since investors had built up significant positions betting on the Japanese currency rising.
Latest data from the Commodity Futures Trading Commission showed that speculators raised net long positions on the yen for the week ended Aug.23 to their highest since early July. speculators' aggregate net long position was the smallest since early July, suggesting the greenback has more room to rise against other currencies.
The dollar index .DXY was little changed at 95.956 after rising to 96.143 overnight, its highest since August 9. It was still on track to lose about 1 percent in August after falling mid-month to a near two-month low of 94.077.
Attention has switched to Friday's U.S. August non-farm payrolls report and with it a chance to assess whether the U.S. economy is robust enough to withstand monetary tightening.
But investors will first digest the ADP employment data and the Chicago purchasing managers' index (PMI) due later on Wednesday.
"The 104 level will come into view for dollar/yen if the U.S. ADP employment report beats expectations," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo.
He noted, however, that dollar/yen may have gone too far, given some risk aversion from falls in crude oil and U.S. stocks and flat Treasury yields.
The Australian dollar edged up 0.2 percent to $0.7526 AUD=D4 on bargain hunting after its overnight slide to a one-month trough of $0.7500 against the broadly stronger U.S. currency.
The Aussie was set to lose 1 percent versus the dollar this month, although it had risen to a near four-month high of $0.7760 early in August with Australia's relatively higher yields a draw for investors escaping negative rates in the euro zone and Japan.