The dollar resumed its rally on Tuesday, shrugging off a surprisingly weak capital flows report and lurching higher against the yen on buying by Japanese investors. The yen got a brief boost in early trade and hit a three-month high against sterling after data showed the Japanese economy grew at its fastest pace in a year in the latest quarter, more than double forecasts.But the yen soon erased its gains across the board, with dealers citing orders from Japanese brokerages for dollars that likely reflect strong investor demand for higher yielding foreign bonds in the face of rock bottom yields in Japan. In April, Japanese investors snapped up 4 trillion yen ($37.43 billion) of foreign debt, the largest amount in four years, as big Japanese institutional investors allocated funds for the fiscal year that began that month. Dealers said speculators who had bought yen on Monday on expectations of strong Japanese growth data were taking profits, while other traders scrambled to cover short positions after the dollar failed to break below a key technical level of 106.50 yen