FOREX-Dollar firmer, traders look to Yellen speech for Fed clues

* Dollar index up more than 2 percent so far in May

* Fed Chair Yellen due to speak later in the day

* Second reading of U.S (Other OTC: UBGXF - news) . GDP for Q1 closely watched (Updates prices)

By Anirban Nag

LONDON, May 27 (Reuters) - The dollar index rose on Friday, on track for its strongest monthly performance since last November as investors anticipate Fed rate rises in coming months and await fresh guidance from the head of the U.S. central bank.

The index was up 0.15 percent at 95.296, having pulled back from Wednesday's two-month peak of 95.661, with month-end rebalancing flows by asset managers likely to limit the gains, traders said. Holidays in Britain and the United States are also likely to curtail volumes on Monday.

The dollar is up 2.4 percent this month, among the top performing currencies, after a string of U.S. Federal Reserve officials raised expectations for an interest rate hike as early as June.

"We will see some consolidation in the dollar after the recent gains with expectations of a June hike still in play," Nomura currency strategist, Yujiro Goto, said.

"Next (Other OTC: NXGH - news) week is a big one with U.S. non-farm payrolls and ISM (Institute for Supply Management) data, so investors are awaiting for more data," Goto said.

Fed Chair Janet Yellen is due to speak at an event hosted by the Harvard University at 1715 GMT. A slew of Fed policymakers from John Williams to Bill Dudley and James Bullard have all sounded relatively hawkish.

"I'm not sure how concerted this whole thing has been -- if it's all kind of planned or if it's just individual members speaking," Nordea Bank (LSE: 0JNL.L - news) head of trading, Jesper Bargmann, said of the Fed officials' comments.

"This is her chance if she wants to give a hint," Bargmann said, referring to Yellen's speech.

As recently as early May a Fed rate hike in June was completely off the agenda. But after a string of good data and the Fed officials' comments, the likelihood of a hike based on Fed funds futures has reached around 30 percent. Expectations have waned a bit in the past day, but most remain confident that the Fed will hike over the summer.

Traders will also eye the second estimate of U.S. gross domestic product for the March quarter. Analysts polled by Reuters expect an upgrade of the earlier reading, which showed the economy grew at its slowest pace in two years.

The euro eased to $1.1178, staying above Wednesday's two-month trough of $1.1129. The dollar was a tad weaker against the yen at 109.65, still down from last Friday's three-week high of 110.59 yen.

There was little reaction to the outcome of a two-day G7 summit. The G7 industrial powers pledged on Friday to seek strong global growth, while papering over differences on currencies and stimulus policies.

The yen showed limited reaction to media reports that Japanese Prime Minister Shinzo Abe is considering delaying a sales tax hike, originally planned in April 2017, by about two years.

If Japan were to delay it further, some market participants say the initial reaction may be for Tokyo shares to rise, which could weigh on the safe-haven yen. (Additional reporting by Masayuki Kitano; Editing by Ruth Pitchford)