FOREX-Euro off 4 1/2-month peak as Portugal vote looms

* Portuguese parliamentary vote in focus

* Worries resurface over Irish debt

* Pound supported after inflation data, eyes on BoE minutes

* Yen trapped by wariness over intervention

By Hideyuki Sano

TOKYO, March 23 (Reuters) - The euro hovered below a 4 1/2-month high on Wednesday as worries about debt problems in Portugal and Ireland sapped appetite for the currency and its near-term outlook is seen hinging on whether Lisbon's make-or-break attempt to garner parliamentary support for its austerity measures will succeed.

Portugal's parliament will vote on the government's latest austerity measures on Wednesday and Prime Minister Jose Socrates has threatened to resign if the opposition fails to approve the measures, setting the stage for a potential collapse of his minority government a day before a European summit where leaders are due to discuss steps to deal with debt problems. [ID:nLDE72L1IO]

"If Prime Minister Socrates steps down, Portugal will likely ask the European Union and the IMF for help, which is likely to trigger a bit of euro selling," said Junya Tanase, chief strategist at JPMorgan Chase Bank in Tokyo.

"But any Portuguese aid package is likely to be much smaller than those for Greece and Ireland. In addition, markets have already been expecting that Portugal will need outside help, so the euro's fall will probably be limited," he added.

The euro traded at $1.4186 in early Asian trade, off Tuesday's high of $1.4249, which was its highest since it peaked out at $1.4283 in early November. An option barrier at $1.4250 helped to block the euro's advance.

Also casting cold water on the euro were rumours that Allied Irish Banks (AIB) , which has been effectively nationalised, was planning to miss a coupon payment, driving the premium that investors demand to hold Irish two-year bonds to a euro-era high.

AIB said in a statement that it would pay the coupon due on March 23 as scheduled.

Still, the euro's yield advantage over the dollar is likely to provide some cushion for the currency, analysts said.

"The euro is so close to its November peak that its rally will inevitably slow. You will need a certain amount of energy to break that level, although I think the euro will eventually rise above that level," said Teppei Ino, currency analyst at the Bank of Tokyo-Mitsubishi UFJ.

The pound held near a 14-month high hit on Tuesday after stronger-than-expected British inflation data increased the chances of an interest rate rise within the next few months.

Sterling traded at $1.6370 , near Tuesday's high of $1.6403, and traders said more gains could be in store for the pound with a rise as far as $1.65 if Bank of England minutes, due out on Wednesday, show a more hawkish bias among policymakers.

The yen moved little over the last 24 hours, sitting still near 81.00 to the dollar , as traders turned cautious about buying the currency after the Group of Seven (G7) countries sold it last week in their first joint intervention in more than a decade.

The market will be wary of intervention particularly below 80.50 yen, where the Bank of Japan came in last Friday. On the other hand, heavy offers from Japanese exporters are seen lined up above 82.00 yen.

The G7 may have sold around 530 billion yen ($6.5 billion) last Friday as they intervened to weaken the currency, data from the Bank of Japan showed on Tuesday. [ID:nL3E7EM1IH]

That amount is far smaller than the approximately 2 trillion yen indicated by market talk, although some analysts said the figure was not a surprise.

"Our interpretation is that the signalling effect from 'coordinated intervention' did most of the job for the BoJ in the short run. Nevertheless, we judge that the BoJ is likely to be ready for more persistent operations, should they be needed," said Jens Nordvig, global head of G10 FX strategy at Nomura in New York. (Additional reporting by Naomi Tajitsu in Hong Kong, Nick Olivari and Wanfeng Zhou in New York; Editing by Edmund Klamann)