Tokyo, June 3 (Bloomberg) -- The dollar rose for a second day against the euro on speculation a report in the U.S. will show manufacturing expanded for a fourth month in May, easing concern the expansion in the biggest economy may slow. The dollar strengthened to 93.15 U.S. cents per euro from 93.42 in late New York trading Friday, climbing back from a 15- month low set last week. The currency hovered at 124.29 yen. Trading may be less than usual because financial markets in the U.K. are closed today and tomorrow for holidays. ``Good economic figures out of the U.S. may cool down anxiety the nation's growth will stall, helping the dollar,'' said Mitsuru Sahara, a vice president for foreign exchange at UFJ Bank Ltd. The dollar may rise to 126 yen by Friday, he said. The Institute for Supply Management's factory index probably rose to 54.5 last month from 53.9, based on the median of 52 forecasts in a Bloomberg News survey of economists. That will follow reports Friday that showed orders placed with U.S. factories rose more in April than at any time since October, and productivity grew during the first quarter at the fastest pace in almost two decades. The dollar has fallen 6.7 percent against the euro in the past three months on concern the U.S.'s rebound from a recession may be slower than investors expected. The yen, meantime, on Friday rounded out a fourth month of gains against the dollar, rising 7.8 percent in the period, its longest winning streak since a six-month, 16 percent rally ended November 1999.

Euro Rally to End?
The slide in the U.S. currency may be about to end. ``There are problems in the U.S., but productivity growth is still much higher than in Europe,'' said Joop Bresser, who helps oversee 17 billion euros ($15 billion) at Delta Lloyd Asset Management in Amsterdam. The euro rally may be coming to a close, he said. The U.S. economy will expand at an annualized 3.1 percent this quarter, compared with 5.6 percent in the first, according to the consensus of the Blue Chip Economic Indicators survey. The European Commission cut its growth estimates to 0.2 percent from 0.3 percent for the first quarter and to between 0.3 percent and 0.6 percent in the second for the dozen-nation economy. That prospect of slowing U.S. growth may weigh on the dollar, some traders said. A U.S. report Friday will probably show the unemployment rate rose to 6.1 percent in May from 6 percent in April, fueling concern a higher jobless rate will hurt consumer spending, which accounts for two-thirds of the nation's economy. ``Unless employment improves, consumer spending is unlikely to expand, and we cannot be optimistic about the U.S. economy and the dollar,'' said Katsunori Kitakura, a treasury department manager at Chuo Mitsui Trust and Banking Co.

More Money
The yen may be helped by expectations a report on Friday will show the Japanese economy grew for the first time in four quarters, luring investors to the nation. The Japanese government will probably report the nation's economy grew an annualized 6.8 percent in the January-to-March period, after shrinking 4.8 percent in the previous quarter, according to a Bloomberg News survey of economists. ``Good gross domestic product figures will heighten speculation more money will flow into Japan, helping the yen,'' said Takashi Toyahara, foreign exchange manager at Nomura Securities Co. Overseas investors were net buyers of Japanese equities for a sixth week in the five days ended May 24, according to the latest Tokyo Stock Exchange figures. The economy will probably shrink 0.3 percent in the April- June period from the previous quarter, economists said.

Intervention
Any rise in the yen may be limited by speculation the Japanese government will sell its currency for a fourth time in two weeks to curb its climb against the dollar. The Bank of Japan sold yen on concern a stronger currency will erode the profits exporters earn on overseas sales, analysts said. The move failed to derail the yen's climb, which is being fueled by optimism the worst of a recession in the nation may be over. The government sold more than 1 trillion yen ($8 billion) of the currency on May 22 and 23, according to a report released today by the Ministry of Finance. Some traders said the government sold about $10 billion worth of yen on May 31. In other trading, the dollar rose to 1.5725 Swiss francs from 1.5678 francs and was little changed at $1.4562 per British pound from $1.4553 Friday.