* Euro rallies vs suffering dollar after China PMI rise
* Dollar struggle on speculation of more QE in U.S.
* Mixed European PMI may weigh on euro
(Adds comment, updates throughout; previous TOKYO)
By Naomi Tajitsu
LONDON, Oct 1 (Reuters) - The euro hit a five-month against the dollar on Friday after upbeat Chinese economic data added to demand for riskier assets, while the U.S. currency continued to struggle on speculation of more monetary easing.
The dollar slipped against the yen, hovering within sight of a 15-year low hit last month which prompted Japan to sell the yen. Investors were wary that a move much lower may trigger more intervention.
A bigger-than-expected rise in China's official purchasing managers' index boosted the Australian dollar, which tends to benefit from signs of a global recovery that will boost demand for its commodities.
Other currencies considered to be higher risk, including the euro, capitalised on selling in the dollar on the view that the United States may have to pump more cash into its ailing economy, which would be negative for the currency.
But analysts said a slide in European PMI figures on Friday may trigger some selling following the euro's strong rally in the past month.
"September was a strong month for risky assets," said Sven Schubert, currency analyst at Credit Suisse in Zurich, referring to the euro's 7 percent rally against the dollar in September.
"Taking this into account, the market may be vulnerable to a temporary correction (in euro/dollar), and it may react more sensitively to weaker PMI readings."
Final German manufacturing PMI slipped to 55.1 in September, but the euro zone overall grew at a slightly faster pace than previously thought.
By 0746 GMT, the euro had climbed to $1.3689 according to Reuters data, up 0.4 percent approaching resistance at a peak of $1.3692 last hit in April.
Traders cited demand from Asia, including official names pushing the euro higher as the dollar's sell-off continues.
In total, the euro has rallied 15 percent against the dollar from a low in June, brushing off problems facing Ireland as it shores up its weak economy and struggling banking sector.
The technical focus is whether it will close above 55- and 100-week moving averages at $1.3612 and $1.3572 respectively, which analysts say would open the way to more gains. Losses against the euro helped to push the dollar down 0.2 percent against a currency basket and drove the dollar index near an eight-month low hit on Thursday.
U.S. DATA AHEAD
The Australian dollar rose 0.3 percent to $0.9695, after hitting a two-year high of $0.9734 on Thursday. Higher interest rates and demand for Australia's resources, especially from China, have fuelled its rally.
The dollar slipped slightly on the day to 83.40 yen, edging closer a 15-year low of 82.87 yen last month. Traders and analysts say a fall below that level may be one potential trigger point for more intervention.
Japanese Finance Minister Yoshihiko Noda said on Friday he would continue to take decisive steps on currency moves when necessary.
The dollar index fell more than 5 percent in September, its worst monthly performance since May 2009, as investors speculate the Federal Reserve will take more quantitative easing steps.
Investors awaited the U.S. ISM manufacturing data due later in the day to better gauge whether the Fed will act soon.
"If we see some good U.S. data it would not be a surprise to see market speculation about the possibility of the Fed embarking on quantitative easing in November fade a bit," said Minoru Shioiri, chief manager of FX trading at Mitsubishi UFJ Morgan Stanley Securities in Tokyo. (Additional reporting by Tokyo Forex Team; Editing by Patrick Graham)