* Sterling gains on housing, GDP data
* U.S. consumer confidence rises, USD/JPY gains
* Euro gives up gains on profit-taking, fiscal concerns (Adds details, updates prices)
By Steven C. Johnson and Vivianne Rodrigues
NEW YORK, March 30 (Reuters) - Sterling rose on Tuesday as data showed the UK economy growing a bit more swiftly than expected while the dollar neared a three-month high against the yen after U.S. data showed consumer confidence rose in March.
The euro continued to struggle, falling sharply against the dollar as investors took profits after two days of gains and as unease persisted about the euro zone's fiscal health.
The dollar rose above 93 yen for the first time since early January as strong consumer confidence data bolstered views that the Federal Reserve will raise interest rates sooner than its Japanese or European counterparts.
It was last up 0.4 percent at 92.82 yen <JPY=>.
"The U.S. economy keeps getting better while Japan is still in deflation, and with the U.S. 10-year Treasury yield knocking on 4 percent, the interest rate differential is pushing the dollar up," said Hidetoshi Yanagihara, senior currency trader at Mizuho Corporate Bank in New York. He said the dollar could reach 95 yen in the second quarter, which begins on Thursday.
The British pound was on track for its strongest day against the greenback in nearly two weeks after revised GDP data showed the economy grew 0.4 percent in the fourth quarter. Separate data showed UK house prices rose in March. For details see [ID:nLAG006193].
In late afternoon trading, the pound rose 0.6 percent to $1.5062 <GBP=> while the euro was changing hands at 89.02 pence, down 1 percent <EURGBP=>.
The euro fell 0.6 percent to $1.3416 <EUR=> and shed 0.5 percent to 124.48 yen <EURJPY=>. Earlier, it hit 125.44 yen, its highest level since early February.
Analysts say that if U.S. nonfarm payrolls data due Friday shows the economy added jobs in March, it may boost the dollar further and bolster expectations for Fed rate hikes this year.
After rising for two straight days after last week's joint European Union-International Monetary Fund agreement on aid for Greece, the euro ran out of steam on Tuesday.
It briefly hit a two-month high against the yen and pushed further above $1.35 overnight but retreated on profit-taking and as worries resurfaced about Greece.
Though Greece sold 5 billion euros of seven-year debt on Monday, spreads between Greek bonds and benchmark German bunds widened on Tuesday, suggesting investors remain worried.
Greek plans to reopen a 20-year bond issue added to worries about its funding needs, while news that Ireland would take a bigger stake in the banking sector than planned raised concern, limiting euro gains. [ID:nLDE62T0XV] and [ID:nLDE62T0BL]
"Last week's deal means it's unlikely you'll see a Greek default, but that doesn't mean we won't have concerns about the ability of Greece or other peripheral euro zone countries to fund their deficits," said Michael Malpede, analyst at Easy Forex in Chicago. "That is going to hurt the euro."
The Australian dollar rose to its strongest in more than a week at $0.9215 <AUD=> after an Australian central bank watcher argued the Reserve Bank of Australia was likely to lift interest rates next week to 4.25 percent. It was last trading at $0.9182, little changed on the day. (Editing by James Dalgleish)