* Upbeat U.S. housing data supports dollar
* Dollar index near 11-month high but seen capped
* Eyes on U.S. inflation, Fed minutes and Jackson Hole
* Kiwi slides as soft data points to pause in tightening
By Hideyuki Sano
TOKYO, Aug 19 The dollar steadied on Tuesday after Monday's gains on upbeat U.S. housing data and a rise in U.S. bond yields, but traders are waiting for hints on Federal Reserve policy intentions before they test major resistance levels.
The only mover among major currencies in Asia was the New Zealand dollar, which shed a half percentage point after soft economic data pointed to a pause in the country's rate hikes.
The U.S. dollar index stood flat at 81.612 , after a gain of 0.2 percent on Monday, lacking the momentum to test its 11-month high of 81.716 hit earlier this month.
"The housing data seems to have had an impact on the dollar. Yet the market is still showing no clear direction yet and I see dollar-selling orders above current levels. It seems better to play ranges," said Bart Wakabayashi, head of currencies at State Street in Tokyo.
The NAHB/Wells Fargo Housing Market index rose unexpectedly for the third straight monthly gain to a seven-month high of 55 in August, shrugging off the weakness of early this year.
The dollar was also bolstered as U.S. bond yields rebounded from lows on Monday, raising the dollar's yield attraction, on hopes of diplomatic solution to the Ukraine crisis even though a ceasefire has not been reached.
Analysts looked ahead to Wednesday's release of minutes from the Federal Reserve's July policy meeting and comments from a global central banking summit in Jackson Hole, Wyoming, starting on Thursday, although expectations were that the Federal Reserve would remain dovish on monetary policy.
U.S. consumer inflation data due later in the day is another focus as tame inflation could enhance expectations that the Fed will wait longer before raising rates.
The euro traded at $1.3361, having managed to hold above a nine-month low of $1.3333 set earlier this month despite concerns about economic weakness in the euro zone and expectations of more easing from the European Central Bank.
"The market is likely to be in euro short positions. So I am bit worried that there could be some short-covering (in the euro)," said Koichi Takamatsu, head of forex at Nomura Securities.
The dollar fetched 102.61 yen, having maintained its slow rebound from a low of 101.51 hit on Aug 8, though few traders expect a break above 103 in the near term.
"I think many people want to test the dollar's upside but on the other hand, you can't expect Yellen to be hawkish and the BOJ is unlikely to ease its policy soon. I doubt it can rise above 103 yen," said a senior trader at a Japanese bank.
The New Zealand dollar fell 0.5 percent to $0.8432 after soft wholesale inflation data and reduced government surplus forecasts suggested the Reserve Bank of New Zealand would be in no hurry to resume rate rises.
A major support is seen at $0.84, its June low, though a break of that level could pose a threat to its uptrend since the middle of last year.
The Australian dollar barely responded to the minutes of the Reserve Bank of Australia's last policy meeting, which contained few surprises, firming slightly to $0.9338. (Editing by Eric Meijer)