* Nikkei gains this year seen not relying on softer yen * Dollar-based Nikkei outperforming U.S., German shares * Economic optimism, governance reforms underpin market * Some say foreign investor interest rising By Tomo Uetake TOKYO, Feb 25 (Reuters) – Japanese share prices this week broke above resistance to hit a 14 1/2-year high in dollar terms, on optimism about Japan’s economic outlook and corporate governance reforms.

For the first time since it began rallying in late 2012 on anticipation Shinzo Abe would become prime minister and pursue aggressive stimulus, or so-called Abenomics, the market appears to no longer rely heavily on a cheaper yen.

“I think it’s a very good sign. For serious, long-term equity investors who don’t want to be currency speculators, they would just like the stock market to go up without the yen going down,” said Christopher Wood, managing director at CLSA.

On Wednesday, the Nikkei share average touched a high of 18,648 points. When divided by the prevailing dollar/yen exchange rate, that’s around 156.98, above a May 2013 peak and the highest level since September 2000.

So far this year, the benchmark Nikkei has risen 7.1 percent in dollar terms and 6.5 percent in yen. In 2014, it fell 5.1 percent in dollar terms, even though it gained 7.1 percent in local currency.

The Nikkei is outperforming U.S. S&P 500 index, which has risen 2.8 percent year-to-day and even beating dollar-based performance of high-flying German shares, which rose 14.3 percent in local currency but 6.3 percent in dollars due to a weak euro.

Driving Japan’s rally are hopes that recovery in the economy and corporate reforms could help boost Japanese companies earnings.

Exports have gained momentum recently after many months of stagnation. Real exports, compiled by the Bank of Japan jumped 5.0 percent in January from the previous month.

BOOST FROM OIL’S FALL Falls in oil prices are a major boost for Japanese companies and consumers as they almost work like a tax cut, given that Japan imports almost all of its needs.

Given that, investors hope companies will make their biggest wage hikes in years at annual labour negotiations in March.

Some investors also hope for more payouts for shareholders as the government pressures companies to boost profitability.

The government has been making a push to boost returns-on-equity while the Tokyo Stock Exchange is introducing guidelines to increase outsider directors.

While this year’s market rally has been driven largely by Japan’s public pension funds and the Bank of Japan, some players see growing foreign interest in Japanese shares.

“I visited Holland, Sweden and Finland to meet long-only investors this month. There is definitely a lot more interest in Japan than in early 2007,” said Alexander Treves, head of Japan equities at Fidelity Worldwide Investment.

(Additional reporting by Hideyuki Sano; Editing by Richard Borsuk)