* Nikkei rises 1.7 pct for the month
* Mitsubishi Motors falls on fuel economy admission
By Ayai Tomisawa
TOKYO, Aug 31 (Reuters) - Japanese stocks rose on Wednesday to highs not seen in two weeks, led by exporters and financial stocks as the dollar stood tall against the yen and upbeat U.S. consumer confidence data lifted expectations of a near-term U.S. interest rate hike.
The Nikkei gained 0.8 percent to 16,856.98 in mid-morning trade after touching 16,885.36, the highest level since August 16. The benchmark index has risen 1.7 percent this month.
The dollar, which was at around 100.500 yen at the start of the week, was little changed at 102.895 after rising on Tuesday to a one-month peak of 103.140.
Toyota Motor Corp gained 2.0 percent, Nissan Motor Co added 1.4 percent and Panasonic Corp rose 1.2 percent.
"Confidence in stocks will likely continue if the dollar maintains the current level or above," said Isao Kubo, equity strategist at Nissay Asset Management, adding that Friday's U.S. jobs data was closely monitored by market participants.
The financial sector also rallied. Nomura Holdings surged 2.1 percent, Daiwa Securities Group added 1.8 percent. Mitsubishi UFJ Financial Group jumped 3.5 percent and Mizuho Financial Group added 3.3 percent.
Mitsubishi Motors Corp tumbled 4.8 percent to a four-week low after the automaker said that more of its vehicle models were involved in a fuel consumption cheating scandal than initially stated.
The broader Topix gained 0.9 percent to 1,324.00 and the JPX-Nikkei Index 400 advanced 0.9 percent to 11,918.26
Reporting by Ayai Tomisawa; Editing by Eric Meijer